www.vetoquinol.com

UNIVERSALREGISTRATIONDOCUMENT

2023

including the Annual Financial ReportContents
12	PRESENTATION OF THE GROUP 

3

1.1	2023, a remarkable year on more than
one count4
1.2	Vetoquinol, your trusted partner in animal
health5
1.3 Vetoquinol strategy
15
1.4 Hybrid growth strategy
17
1.5 Value-creating business model
18
1.6 Global animal health market
20
1.7 Vetoquinol: an industrial Group22
1.8 Financial performance
25
1.9 Non-financial performance
26
1.10 Simplified organizational chart
27

STATEMENT OF NON-FINANCIALPERFORMANCE29
2.1	Sustainable development at the heart of
Vetoquinol's strategic plan30
2.2	Corporate Social Responsibility: a pillar of
31
Vetoquinol's strategy
2.3 Materiality matrix
32
2.4 Green taxonomy
33
2.5 Vetoquinol's sustainable development goals 34
2.6	Overall health, safety and the environmental
policy37
2.7 Vetoquinol’s people
39
2.8 Carbon footprint
52
2.9 Our products
60
2.10 Social footprint
65
2.11 European green taxonomy
70
2.12 Summary table of non-financial indicators 73
2.13 Report by the independent third-party body 76

6



CONSOLIDATED FINANCIAL
STATEMENTS79
6.1	Consolidated statement of comprehensive
income80
6.2 Consolidated statement of financial position 81
6.3 Consolidated statement of cash flows
82
6.4 Statement of changes in consolidated equity 83
6.5 Notes to the consolidated financial
statements84
6.6	Statutory Auditors' report on the
consolidated financial statements
122

PRESENTATION OF THE GROUP _ 1
Vetoquinol, your trusted partner in animal health2023

UNIVERSALREGISTRATIONDOCUMENT
including the Annual Financial Report

Note: this pdf format document is a translation of three chapters of the Universal Registration Document which serves as
Annual Financial Report for the year ended December 31, 2023. It is a partial reproduction of the official version in ESEF
format which is available on the Vetoquinol website, www.vetoquinol.com.
The original French Universal Registration Document was filed with the AMF (French Financial Markets Authority) on April 24, 2024.
Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 1

2 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

1
PRESENTATION OF THE GROUP
1.1	2023, A REMARKABLE YEAR ON MORE THAN
ONE COUNT TITLE

4

1.2	VETOQUINOL, YOUR TRUSTED PARTNER
IN ANIMAL HEALTH 

5

1.2.1 Business overview 
1.2.2 Vetoquinol key figures 
1.2.3	90 years in the service of animal health 
1.2.4	A presence in the main animal health countries 

5
6
8
14

1.3	VETOQUINOL STRATEGY 

15

1.3.1	A strategy focused on Essential products 
1.3.2 Multi-specialist strategy geared to “One Health”  

15
16

1.4	HYBRID GROWTH STRATEGY 

17

1.5	VALUE-CREATING BUSINESS MODEL 

1.6	GLOBAL ANIMAL HEALTH MARKET 

20

1.6.1	Global animal health market 
1.6.2	The animal health market by region 
1.6.3 Animal health market outlook 

20
20
21

1.7	VETOQUINOL: AN INDUSTRIAL GROUP 

22

1.7.1 France (Lure, Tarare, Paris and Angers)  
1.7.2 Poland (Gorzów, Klodawa) 
1.7.3 Goiania (Brazil) 
1.7.4 Princeville (Canada) 
1.3.5	Main investments made over the last three years excluding IFRS 16 

22
23
24
24

1.8	FINANCIAL PERFORMANCE 

25

1.9	NON-FINANCIAL PERFORMANCE 

26

1.10	SIMPLIFIED ORGANIZATIONAL CHART 

27

24

18

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 3

1 ­_ PRESENTATION OF THE GROUP
2023, A remarkable year on more than one count title

1.1	2023, A REMARKABLE YEARON MORE THAN ONE COUNT

2023 was a remarkable year, and I would like to take theopportunity to highlight the following facts:• Since its inception in Lure in 1933, the laboratory has
consistently upheld the values that define our group: a dedication to the welfare of both humans and animals.
• Our laboratory has demonstrated its ability to build a sustainablegrowth dynamic on its essential products and the development of its business in the USA. Our Essentials now accountfor almost 60% of our group sales, with the USA accounting
for over 20%. Felpreva® and Simplera® have performed well inEurope and the US, respectively, allowing our Group to consolidate its profitability and cash generation at a high level.
•The dedication demonstrated by our employees year afteryear, ensuring Vetoquinol's continued growth and success. Our
teams in 24 diverse countries play a pivotal role in the company's ambitious expansion and development plans for thelaboratories.
2023 was a pivotal year for Vetoquinol. The company reached a defining moment, exemplifying thevalues of a family-run business and the ambition to enhance the quality of life for animals through its
dedication to animal health and welfare.

Matthieu Frechin
Chairman and Chief Executive Officer

4 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportPRESENTATION OF THE GROUP _ 1
Vetoquinol, your trusted partner in animal health1.2	VETOQUINOL, YOUR TRUSTEDPARTNER IN ANIMAL HEALTH
Vetoquinol was established in 1933 and has since become a leading global player in the animal health industry. Vetoquinol develops, produces and sells pharmaceuticals and non-medicinal products for livestock (cattle, pigs) and pets
(dogs, cats).
Vetoquinol is one of the world's Top 10 veterinary pharmaceutical companies. The company is committed to sustainability, growth and responsibility, as well as pursuing its human adventure.

Vetoquinol is dedicated to enriching people's lives
through its commitment to animal health and welfare.
1.2.1

Business overview

Vetoquinol is a global leader in the development, manufacturing and sale of veterinary drugs and non-medicinal
products, with a dedicated focus on animal health. The
veterinary profession is undergoing rapid evolution, andas a leading company in the field, Vetoquinol offers
customers comprehensive solutions that include pharmaceutical and nutraceutical products, diagnostics, digitalapplications, and services.
Vetoquinol has developed a range of products called"Essentials", which offer high potential for growth in themarket. These products have been designed to meet the
key needs identified by vets for pet owners and cattle andpig breeders. These products are intended for sale on a
global scale. Their scale effect improves their economic
performance.
Vetoquinol's history began in France. Today, over 90 years
later, Vetoquinol products are sold in over 100 countries,
including 24 countries in which Vetoquinol operates directly. France accounts for less than 15% of the Group’s
sales. The USA represents Vetoquinol's largest market.

Vetoquinol develops and markets several patented products, but the active ingredients in most cases have fallen
into the public domain. These royalty-free molecules arecomplemented by galenic and formulation innovations,which are born of the company's know-how and research
efforts. These innovations represent strong differentiating factors and competitive advantages.
Vetoquinol is an active member of national, regional andinternational bodies representing the profession. In particular, Vetoquinol is a corporate member of Health For
Animals and Animal Health Europe. These bodies represent all the leading global veterinary pharmaceuticalcompanies.
Vetoquinol has dedicated its entire business for 90 years
to the veterinary medicine sector. Its activities benefit thevets, animals, pet owners and breeders that it serves.
As a company that serves four target species representing 80% of the global market, Vetoquinol has a balanced
risk profile. Vetoquinol operates in both the pet and livestock segments.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 5

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol, your trusted partner in animal health

1.2.2

Vetoquinol in key figures

2,500 EMPLOYEESIN 24 LARGEST COUNTRIES,IN THE ANIMAL HEALTH
SECTOR€529M SALES IN 2023,
INCLUDING €313M FROMESSENTIAL PRODUCTS

3 TARGET ANIMALSPECIES:
DOGS, CATS AND CATTLE

4 STRATEGIC SEGMENTS:
PARASITICIDES,
MOBILITY, DERMATOLOGYAND DAIRY COWS

A BROAD CUSTOMER ECOSYSTEM:VETS, BREEDERS, PET OWNERS,E-TAILERS, PHARMACIES,PET SHOPS
6 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportPRESENTATION OF THE GROUP _ 1
Vetoquinol, your trusted partner in animal health

1,000 MARKETING
AUTHORIZATIONS+500 REGISTERED
TRADEMARKS

27 MILLION UNITSMANUFACTURED
WITH 4,000 REFERENCES(veterinary medicines,
nutraceuticals, diagnostics
and digital solutions)

8TH ANIMAL HEALTH COMPANY WORLDWIDEFAMILY-OWNED COMPANY

8e

3rd generation
at the helm of Vetoquinol

A GLOBAL ANIMALHEALTH MARKET VALUED
AT €40BN
Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 7

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol, your trusted partner in animal health

1.2.3

Serving animal health for 90 years

Vetoquinol, a fine long history of entrepreneurship

Joseph Frechin

Étienne Frechin

Matthieu Frechin

Joseph Frechin's inspiration
The company's origins can be traced back to 1933, when
it was established in a pharmacy in Lure, a small town ineastern France. Joseph Frechin expanded his pharmacy
business to include the production of specialised humanpharmaceuticals, naming his company "Laboratoires
Biochimiques de l'Est". Mr. Frechin proceeded to build a
substantial inventory of oxyquinoline, an antiseptic developed by a chemist friend.

8 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

This led him to the decision to utilise the product in a veterinary context. Subsequently, he conducted the inauguraltrials with the assistance of his father, Charles Frechin, ahighly regarded veterinary surgeon in the area. The outcomes were highly encouraging. The remedy, which wasnamed Vetoquinol, became an instant success and was
rapidly made available in many forms, including tablets,
powder, gel, oblets, vaginal inserts and creams. In 1948,
Joseph Frechin expanded the laboratory into a veterinary
department, which became the foundation for Vetoquinol.

PRESENTATION OF THE GROUP _ 1
Vetoquinol, your trusted partner in animal health

Étienne Frechin's far-reaching vision

Matthieu Frechin's commitment

Following the war, Vetoquinol's expansion was driven by
the agricultural sector, which was rebuilding its herds
and making increasing use of veterinary medicines. Vetoquinol gradually expanded, employing around 100 people.

In April 2010, Matthieu Frechin was appointed Chief
Executive Officer of Vetoquinol. As the grandson of thecompany’s founder and the third generation to take thehelm, his appointment signifies the shareholders’ commitment to continuing Vetoquinol's success story, guided
by the same principles of boldness, commitment andindependence.

In 1962, Étienne Frechin took over the family company tofocus on its growth and development. He relocated thecompany headquarters to Magny-Vernois, a village justoutside Lure.
Since then, Vetoquinol has expanded its product range
and introduced innovative solutions for customers.
By 1980, 20% of sales were already generated outside
France.
With a total of 280 employees at the time, the company
established an international department and set up subsidiaries in the Netherlands, Ireland and Belgium.
Through acquisitions and mergers, Vetoquinol gradually
expanded its global network of subsidiaries.
In 2006, the company successfully completed its IPO,
enabling it to secure new funds and expand its operations into new markets. This milestone proved to be an
excellent opportunity to enhance its brand image andshare its vision for the future of the animal health industry.

To ensure its continued development, Vetoquinol has
decided that it should remain independent. The company’s manageable size and family shareholding structure
facilitate flexibility and responsiveness.
The entrepreneurial focus, innovative approach, andstrong team spirit that Matthieu brings to the table areinvaluable assets for developing new products and solutions to promote animal health, enhance the daily lives ofcattle breeders and pet owners, and assist vets in fulfilling their mission. However, customer needs remain the
primary source of our inspiration.
Matthieu Frechin is fostering a new dynamic based on initiative, voluntarism and motivation. This transformation is
inspired by Vetoquinol's mission to "enrich people’s lives
through dedication to animal health and welfare" and by
the values shared by employees throughout the Group:
trust, dare and collaborate. Vetoquinol is a company thathas been shaped by these values. They have created aculture of shared passion, energy, and commitment.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 9

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol, your trusted partner in animal health

1977

Consolidationof activities
at Magny-Vernois.

The renamed company
Vetoquinol sets
up its first foreignsubsidiary, Vetam,in the Netherlands
subsidiary.

10 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

The company opens an R&D
centre in Lure and sets up
its "Export" department.

1987

1980

Joseph Frechin,a pharmacist in
Lure, launched its
animal antiseptic"Vetoquinol".

1962

1933

Vetoquinol over the years

Launch of theanti-inflammatory
Tolfedine®.

With the acquisitionof Farmagricola,
Vetoquinol establishes
a presence in Brazil,
the world's 3rd largest
market.
European launch of
Cimalgex® and Forcyl®.

New international
acquisitions (Switzerland,
China, Korea, Portugal,
Scandinavia, Canada,
India...).
Launch of Aurizon®,Prilium®, Propalin®,
Clavaseptin®, Vetprofen®,
Rubénal®, Kefloril®,Ceftiocyl®.

2014

Launch of the antiinfective Marbocyl®
(1995).

2011

Vetoquinol
establishes apresence in England,
Spain, Canada, theUnited States andGermany.

2001-2010

1990-2000

PRESENTATION OF THE GROUP _ 1
Vetoquinol, your trusted partner in animal health

Vetoquinol obtains its
licence to distribute its
products in China.
Acquisition of Bioniche
Animal Health in North
America.
New flagship products inthe field of reproduction.

Acquisition of the Evsco®
and Tomlyn® ranges.
Listed on the Paris stock
exchange (2006).

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 11

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol, your trusted partner in animal healthCreation of a R&D
centre in the UnitedStates.

Vetoquinol enters
the digital domain byacquiring a majority stakein FarmVet Systems Ltd
based in Northern Ireland.

Vetoquinol wins
2nd prize in the GaïaIndex 2017 for its
commitment to CSR.

Launch of two products
for pets: Sonotix andFlexadin Chews.

2019

2018

Vetoquinol isawarded best listed
SMI-SME in termsof CSR.

2017

2016

Vetoquinol is
the first animal
health company toobtain ISO 50001
certification for its
Magny-Vernois site.

Vetoquinol acquires 90%
of Clarion Biociencias, aBrazilian company.
Opening of a subsidiary in
New Zealand: Vetoquinol
New Zealand Ltd.
Acquisition of Phovia®,
a fluorescent light energy(FLE) product.

12 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportPRESENTATION OF THE GROUP _ 1
Vetoquinol, your trusted partner in animal healthMatthieu Frechin becomes
Chairman and CEO of
Vetoquinol .

2023

Vetoquinol acquires
Profender® andDrontal® for Europe
and the United
Kingdom, Australia
and Switzerland(2021).

2022

2020

Vetoquinol celebrates its
90th anniversary in all its
subsidiaries.

Launch of Simplera® in
the United States, for thetreatment of otitis in dogs.

Launch in Europe
of Felpreva®,
endectoparasite for cats.
Launch in the UnitedStates of Imoxi®,
endectoparasite for dogs
and cats.
Launch of the newstrategic plan "Ambition2026".

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 13

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol, your trusted partner in animal health

1.2.4	Operations in all main animal health markets

Direct operations in 24 countries

FranceGermany

Europe

UK

47%

Italy
Spain
PolandBelgium
The Netherlands
Czech Republic
Austria
Ireland

AmericasPortugal38%

SwedenSwitzerland
USA
CanadaMexicoBrazilAsia-Pacific/
Rest of the
World

India
South Korea
China

15%

AustraliaJapan
New Zealand

Nearly 100 distributors worldwide
14 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportPRESENTATION OF THE GROUP _ 1
Vetoquinol's strategy

Proven expertise in company acquisitions
Since Vetoquinol's inaugural subsidiary in the Netherlands in 1977, the Group's development has been
primarily driven by external growth. The Group management has consistently pursued an acquisitions strategy,
with a focus on commercial and industrial synergies todrive organic sales growth.

Commercialisation et distribution
The Group is divided into four territories for operational
purposes: The Group is divided into four geographicalregions: Europe, the USA, Asia-Pacific and Latin America/
Canada.
In each country, the subsidiary reports to the Business
Area (BA) Director to which it is attached, and has its own
sales force, marketing department, regulatory department and support functions.
The BA Directors are responsible for managing operations in their respective territories, including partnershipmanagement and relationships with local distributors
in accordance with the Group's strategy and policies.
BA Directors are members of the Group Executive Committee. By the end of December 2023, the Group had asalesforce of nearly 900 people, qualified to meet customer needs across all subsidiaries. Veterinary experts
provide regular technical training for these professionals,
while in-house trainers offer guidance on sales and communication skills (Sales Excellence Program).
The company's long-term sales policy is focused on
maintaining a high-quality relationship between its
veterinary representatives and its veterinary partner customers. This is achieved through active listening and a
responsive approach to customer needs. Vetoquinol'scustomer-centric approach is founded on the principles
of listening carefully to customers and identifying andmarketing solutions that align precisely with their needs.
Vetoquinol is distinguished by its commitment to providing long-term support to its veterinary partners.
Vetoquinol's commitment to quality extends beyond themarketing of products to the design and implementationof value-adding initiatives in collaboration with vets toenhance their daily practice and better serve their clients,
pet owners, and breeders. Such tools include digital
tools for improved observation and training in technicalmatters, as well as for selling services.

1.3	VETOQUINOL'S STRATEGY
1.3.1	A strategy focusing on Essential products
Vetoquinol is a leading international pharmaceuticalcompany specialising in the research, manufacture andsale of drugs, non-medicinal products and solutions forthe animal health industry.
The veterinary market is evolving rapidly, but remains
resilient thanks to the introduction of innovative new products, digital technology, and diagnostic tools that enable
Vetoquinol and its customers to respond differently andmore effectively to the expectations of breeders, petowners, and vets. At Vetoquinol, we aim to provide ourcustomers with integrated, complete solutions that meettheir needs and integrate the necessary components toachieve results that meet their expectations.

The global human population is expanding, and thedemand for animal proteins (such as milk, eggs, andmeat) is rising. This is driving livestock farmers aroundthe world to seek greater productivity. They must also
focus on the quality, health, and welfare of their animals.
Vetoquinol benefits from privileged relationships withveterinarians. As a result, it is well placed to offer breeders advice, products and associated services to assist
them in meeting the increasingly complex challenges
they face. Vetoquinol's proximity and expertise are invaluable in assisting those tasked with maintaining animal
health and preventing zoonotic infections.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 15

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol's strategy

The pet segment is characterized by sustained growth
in mature countries and substantial development potential in emerging countries. Vetoquinol offers productsthat combine efficacy and simplicity of use, which resonate with the unique emotional bonds that pet owners
have with their pets. As an animal health company, Veto-

quinol selects and is committed to offering cutting-edge
solutions to reinforce and safeguard the bond between
humans and animals. Vetoquinol’s core mission is toenrich the lives of people and animals by focusing on
animal health and welfare.

1.3.2	A multi-specialist strategy geared to “one health”
The number of significant global health crises has risen
sharply over the past century, as the global population
has grown, transportation has intensified, the environment has deteriorated, and urban areas have expanded.
The health crisis has served as a timely reminder of theimportance of working within the context of One Health.
One Health promotes an integrated, systemic, and unified
approach to public, animal, and environmental health. At
Vetoquinol, we recognise the interconnectivity of animaland human health and are committed to implementing a
coherent policy in terms of safety, health and the environment.

16 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

In order to meet the day-to-day needs of veterinarians,
Vetoquinol has developed a range of products, which it
refers to as "Essentials". These products cover most of
their customers’ needs. These are products with a provenor potential international reach that are either actual or
potential leaders in their respective therapeutic field.
Vetoquinol offers comprehensive solutions for the majority of treatment areas, with recognised expertise acrossa range of therapeutic disciplines, including mobility,
parasitology, dermatology and dairy cows.

PRESENTATION OF THE GROUP _ 1
A hybrid growth strategy

1.4	A HYBRID GROWTH STRATEGY
Vetoquinol's strategic approach is underpinned by soundfinancial management and robust control of the development, production and marketing process. The businessalso draws upon extensive expertise in its core areas todrive consistent profitable growth. The external growthstrategy has been consistently applied in a measured
and controlled manner, with a clear focus on achieving
financial results aligned with the company's establishedstandards.
• Targeted growth: Vetoquinol is focusing its resources
on a select group of strategic markets and three target
species: cattle, dogs, and cats.
• The market for pet products remains robust in mature
countries despite the challenging economic climate.
Household spending on pets is high in these countries
because pets are regarded as an important member ofthe family. In the livestock segment, our Group is well
positioned to benefit from the increase in the global
population and demand for animal proteins.
• Vetoquinol has developed in-depth expertise in targeted
therapeutic domains in the pet segment. Vetoquinol has
selected dermatology, parasitology, and improving mobility as its key areas of expertise. In the livestock sector,
Vetoquinol concentrates its efforts on addressing all
pathologies associated with dairy cattle breeding. In
2020, the purchase of Drontal® and Profender® productsin Europe gave Vetoquinol access to the pet antiparasitic market. In 2022, the European launch of Felpreva®
and its subsequent rollout to other countries in 2023
reinforced the company's expertise in this field. This
market represents the largest global value within the
animal health sector and this success marks a significant milestone in the Group's history.

• Vetoquinol is consolidating its position in Europe while
also winning market share in the Americas and Asia-Pacific. The Vetoquinol Group has reinforced its market
position in the United States, the world's leading market
for animal health products, and is maintaining its investment strategy in Brazil. The Group has a presence inAsia, with operations in China, India, South Korea, Australia, New Zealand and Japan.
Vetoquinol has therefore been able to extend its international reach, strengthen its position in targeted
therapeutic segments, leverage its research efforts and,as a result, maintain a balanced risk profile.
As of December 31, 2023, Vetoquinol boasts a robust
financial structure to pursue its hybrid growth strategy
and the resources to finance its ambitions for external
growth and partnerships, while continuing to drive its
development in complete independence.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 17

1 ­_ PRESENTATION OF THE GROUP
Value-creating business model

1.5 VALUE-CREATING BUSINESS MODEL
Our vision

Our mission

To be by 2033 “the most agile animal health company where employees,
experts, partners and customers work together to create customized
animal health solutions for a better planet”.

To enrich people's lives
through our dedication toanimal health and welfare.

GROWTH MODELASSETSENVIRONMENTAL
Energy and waterICT

2,483 employees
in 24 countries

ON
5 sites worldwide, EU GMP

PRODU

HUMAN

and US GMP certified

4,000 references: veterinary
drugs, nutraceuticals,diagnostics and digitalsolutions
60 subcontractors

ECONOMIC€527M shareholders' equity€130M net cash position*

R&D

5 R&D sites
7.6% of sales invested in R&D
203 people in R&D

INDUSTRIALCAPEX > €19 M€78.3 M spent on raw materials

A leading international pharmaceutical company
dedicated to animal health for over 90 years

SOCIAL
Relations with our stakeholders
2,300 suppliers, partners
and customers on 5 continentsINand packaging items

N

AT
OV

ION

4 strategic segments:

anti-parasitics, mobility,dermatology and dairy cows

100+ partners:

universities, laboratories,
biotechs

FAMILY-OWNED COMPANY

67% founding family
and 33% floating* Including IFR 16 (€14.4m).

18 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

5 R&D hubs
Sourcing, formulation,clinical development
and registration

PRESENTATION OF THE GROUP _ 1
Value-creating business model

Trends in the global animal health market

US

MER ACCO
E
T
1,000 employees• Constant regulatory changes• Importance of animal welfare

CREATING SHARED
VALUE

S

S

C

Increase in global human population andanimal protein production

dedicated to customer service

2 target species: petsand livestock

70% of business with petsand 30% with livestock
Our customers:
veterinarians, breeders
and pet owners

MAIN ESSENTIAL PRODUCTS

HUMAN

72,000 hours of training

Gender equality implemented€119 M gross salaries paidand €39 M employer contributions

ENVIRONMENTAL
Reduced carbon footprint
Eco-friendly products

ECONOMIC€529 M in sales in 2023
21.3% EBITDA€89 M operating cash flow

Expansion of veterinary
clinic business

INTELLECTUAL

Injectable Solution

1,000 marketing authorizationsin portfolio+ 500 registered trademarks

INDUSTRIAL

Continuous industrial
improvement

Environmental responsibility

T

FORM

Human resources
development

NS
A
R

AT

I

ON

Customer experience

Digital transformation

21 million units manufactured

SOCIAL
Commitment and ethics
Company sustainability
Patronage and donations
Animal welfare

FAMILY-OWNED COMPANY
Company sustainability
Stable payout

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 19

1 ­_ PRÉSENTATION DE LA SOCIÉTÉAnimal health world market

1.6 ANIMAL HEALTH WORLD MARKET
1.6.1

Animal health world market

The animal health industry continued to experience
growth in 2023, with an estimated increase of 5% (source:
Vetoquinol 2023 estimates). This balanced growth wasobserved across both the pet and livestock markets,driven exclusively by pricing impact.
With regard to species, the animal health market isdivided into two categories of activity: livestock (cattle,
sheep, pigs, poultry, etc.) and pets (dogs, cats, horses,etc.). These two market segments have distinctive econo-

1.6.2

mic characteristics, reflecting their different product andcustomer bases.
• The livestock segment is characterised by high volumes
and a strong focus on profitability, making it sensitive tochanges in market conditions, particularly in the event ofhealth crises.
•The pet segment represents a higher value-added
market that is also experiencing faster growth.

Animal health market by region

EuropeLatin America

Europe has consistently been the most significant market
for Vetoquinol, with subsidiaries in all major countries.

The region has experienced significant growth, driven
by a strong demand for beef, pork, and poultry. The petmarket has also seen a surge in popularity as the population's standards of living have improved.

In Europe, the livestock industry's main growth driver is thevaccines segment, which has offset a continuing decline
in the antibiotics market. The pet segment is demonstrating the greatest growth in the areas of parasitology andin specialized pharmaceutical products for dermatology,
osteoarthritis and cardiology. The 2020 acquisition of
the Drontal® and Profender® ranges, along with the 2022
launch of Felpreva®, has enabled Vetoquinol to establish
a strong foothold in the parasitology segment. This aligns
with the company’s overall strategic vision. In Europe,2023 saw the launch of Mastatest®, a diagnostic targeting udder infections in dairy cows.

Americas
For the Americas, we can identify two distinct market
areas: The North American market, which represents amature market, and the Latin American market, which
represents a developing market, are both significant in the
global market.

North America
North America, and the USA in particular, represents
the world's largest market for animal health products,
accounting for over 30% of the global market. In termsof pet products, the US represents approximately half ofthe global market in this category. The Canadian market
represents the world's 10th largest animal health market.
The North American market is led by the pet segment,with strong performances in parasiticides, dermatology
and the introduction of new products. 2023 saw thesuccessful launch of Simplera® in the United States by
Vetoquinol, an otological solution dedicated to dogs.
20 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Brazil is the world's third largest market and home to oneof the largest cattle herds, with approximately ten times
the cattle of France. Brazil is pursuing a goal of becoming the world's leading producer and exporter of animal
proteins, demonstrating both ambition and political will.
The country is not only one of the world's leading producers of cattle and poultry, but also offers significant
growth potential in the pet market.
Vetoquinol is seeking to strengthen its presence in thiskey territory and establish a recognized position there.

Asia/Pacific (and rest of the world)
Following Latin America, Asia/Pacific represents a territory with considerable growth potential, despite a Chinese
market that has been affected by an abrupt halt in growth
due to the Covid zero policy and the impact of the swine
fever health crisis.
Vetoquinol has a presence in these markets in two ways.
Firstly, it operates through subsidiaries in each market.
Secondly, it has a network of distributors in most countries in the zone.
Vetoquinol has a direct presence in South Korea, India,
China, Australia/New Zealand and Japan. These territories present a significant growth opportunity for theGroup across all species and strategic segments. In 2023,
Vetoquinol strengthened its position with the launch ofFelpreva® in Australia.
Vetoquinol is also represented in most countries in theregion through a network of distributors.

PRESENTATION OF THE GROUP _ 1
Animal health world market

1.6.3

Animal health market outlook

The ongoing geopolitical and economic challenges are
resulting in high levels of uncertainty in terms of the availability of energy supplies and the procurement of key raw
materials. Global inflation is reducing consumer purchasing power and creating an uncertain economic situation,with impacts sometimes more noticeable in certain
regions.
In spite of this challenging global context, the animal
health sector is demonstrating remarkable resilience.
The following are the main trends that should be observed in the animal health market over the next few years:

Market trends• The pet segment is expected to make the most significant contribution to growth.
• The livestock segment is affected by regional diseases
such as swine fever, bluetongue, avian flu and foot-andmouth disease. Despite this, it is expected to remain
resilient, supported by continued demand for animal
proteins.
• The combination of an ageing pet population, coupledwith the development of diagnostic and treatment services, is expected to drive the sales of veterinary drugs
for the treatment of chronic illnesses.
• The consolidation of clinic chains or groups will likely
increase, offering Vetoquinol privileged partnership
opportunities. This will put pressure on the economic
relationship between Vetoquinol and pharmaceuticalmanufacturers.
• The rapid growth of new distribution channels will help to
expand target coverage, particularly in the pet segment.

Regulatory changes• The implementation of new, more restrictive sustainable
development and public health standards has resulted
in increased regulatory constraints.
•
Restrictions on the use of antibiotics have become
increasingly strict, with non-curative treatments being
banned and the rational use of antibiotics being encouraged in curative treatments. This is being done in an
attempt to combat antibiotic resistance.
• The introduction of more robust regulatory measures tobetter safeguard animal health, with a view to preventing
and managing animal-based health crises (e.g. swine
fever in Asia) and zoonoses (e.g. coronavirus).

Digital transformation• Digitalisation has been accelerated in the wake of theCovid crisis, with impacts on both the value chain andthe customer access channels.
• A digital transformation of the pet and livestock sector
is driving innovation in terms of solutions and services.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 21

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol: an industrial group

1.7 VETOQUINOL: AN INDUSTRIAL GROUP
Vetoquinol’s production units transform raw materials(active ingredients, excipients) into finished products, tostore and ship them, and, more rarely, manufacture active
ingredients. These processes are carried out under conditions that guarantee product quality, safety and efficacy.
In 2023, Vetoquinol manufactured over 21 million units ina variety of forms:•s terile injectable liquids ;•d rinkable liquids ;•p owders and pellets ;•p astes and cream ;• t ablets ;•d rug premixes ;•a nti-parasite collars and tags ;•s oft chews.
As of December 31, 2023, Vetoquinol had five production
units.
In general, Vetoquinol's international sales subsidiaries
lease the buildings in which they operate.
• All of the company's plants have received GMP approval
for their respective products, with the exception of
Tarare, where only non-medicinal products are made.
The Princeville site in Canada holds FDA-certification.
•In the event that a product requires technical expertise that Vetoquinol lacks, the company partners with
subcontracting firms. These suppliers are monitored
and evaluated by the Industrial and Quality department
to ensure that the same level of compliance is maintained across all Group facilities.

1.7.1

Vetoquinol also handles the distribution of other companies’ products, which are also subject to regularmonitoring and auditing by the industrial and quality
department.
A systematic quality approach has been implemented
across all of the Group’s production lines, reflected in thescale of the human resources dedicated to this purpose:for every two people in production, there is one person inquality (assurance or control).
Quality control procedures include:
control and release of raw materials and packaging•
items;• control and release of finished products;•w
 ater, air and environmental compliance.
The Quality Assurance department ensures that all Group
plants and external manufacturers comply with all pharmaceutical standards, including those set out by GMP,
FDA, PMDA, MAPA, FAMI QS and ISO. They also ensurethat the necessary resources, in terms of quantity andquality, are available in the areas of materials, equipment,
personnel, organisation, premises and flows.

Sites in France (Lure, Tarare, Paris and Angers)

The Lure site, located in Magny-Vernois, is owned by Vetoquinol.
The site encompasses an area of nearly 16 hectares,
including over 24,000 sqm of built areas (floor area), or
nearly 37,000 sqm of developed area. This site houses
the company's headquarters, industrial activities, R&D,
logistics and Group functions. The site also produces
veterinary drugs and non-medicinal products for theentire global market. This unit produces sterile injectableliquids, non-sterile liquids and creams, and products indry forms.
The Tarare site occupies a 10,000 sqm site with two
built-up areas totalling 4,000 sqm. Vetoquinol owns thepremises. Since February 2014, the Company has held
a commercial lease for office premises in Paris, whichhouse the France Division and various Group functions.

22 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

In September 2018, the company expanded its operations by purchasing a research and development center
located near Angers. This site occupies approximately
100 hectares of leased agricultural land.

1.7.1.1 Classified facilities
The Lure facility is subject to the dual declaration andregistration regime applicable to facilities classified
under the ICPE (nomenclature revised in 2006 and 2010).
The site is operated in compliance with its updated
authorization order, taking into account the site's recent
extensions.
The Lure site is subject to regular inspection by DREAL,
with the most recent inspection occurring in July 2023.

PRESENTATION OF THE GROUP _ 1
Vetoquinol: an industrial group

The Lure facility is not subject to the Seveso directives. All
drugs and their active raw materials are likely to present
some environmental risk; however, the drugs produced by
Vetoquinol do not present a greater risk than human orveterinary drugs on the market.

1.7.1.2 Environmental protection
Vetoquinol has put in place an adequate environmental
protection programme, with particular focus on wastesorting, water consumption, groundwater and surface
water pollution prevention, drinking water network protection, noise abatement and energy consumption.
Please refer to the information presented in the DPEF in
chapter 2 for further details.

1.7.2

1.7.1.3 Tarare site
The Tarare site is not subject to the provisions governingclassified facilities.
The non-medicated products manufactured on this site
do not present any risk to the environment. Only a small
number of raw materials, which may present a hazard
under certain circumstances, are present in small quantities at the plant.
Significant investment has been made over the past few
years in the security of our premises.

Sites in Poland (Gorzów, Klodawa)

Vetoquinol Biowet Sp. Z.o.o. owns three sites in the
Gorzów Wielkopolski district:• a production site in Gorzów itself, with a built surface
area of nearly 8,000 sqm, on a plot of land of approximately 14,000 sqm. The site is home to the Polishsubsidiary's management, production units and laboratories.
It comprises:• a production plant in Gorzów with a built area of nearly
8,000 sqm, on a plot of land of around 34,000 sqm;
• a storage site and logistics centre in Gorzów containing
over 1,000 sqm of warehouses on a 6,000 sqm plot ofland.

The Gorzów facility liaises with local authorities tomanage environmental issues. Over the past three years,
inspections have not identified any significant issues.
This site is engaged in the production of veterinary
drugs and non-medicinal products for the global market
outside the USA. The company produces a range of pharmaceutical products, including sterile injectable liquids,
non-sterile liquids, gels, non-sterile suspensions, pellets,
powders, tablets and liquid parasiticides. Major investments have been made in this area over the course of2022/2023.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 23

1 ­_ PRESENTATION OF THE GROUP
Vetoquinol: an industrial group

1.7.3

Goiania site (Brazil)

Vetoquinol Saúde Animal Ltda, a Group subsidiary, is theowner of the Goiania plant, located in Goiás state. The
buildings cover an area of 7,725 sqm on a 15,341 sqm
plot. The facility manufactures sterile and non-sterile
injectable products, with an annual production capacityof seven million units. Furthermore, the site specialises

1.7.4

in the production of external parasiticide devices. The
Goiânia plant employs 80 people and is fully compliant with all current MAPA regulations. It was recently
GMP-certified by the Brazilian authorities. The Goiânia
facility houses a product innovation and research centre.

Princeville site (Canada)

Vetoquinol North America Inc. owns the Princeville plantin the province of Quebec. The site covers 20,000 square
metres of land and 7,000 square metres of developed
premises (laboratories, workshops, warehouses, officespace).

This facility manufactures veterinary pharmaceuticals
and non-medicinal products, primarily for the North American market but also for the European and Asian ones.
The site produces a variety of products including liquids,
pastes, powders and an active ingredient used in oneof our proprietary products. This site holds FDA, Health
Canada and European Union certifications.

1.7.5	Main investments made over the last three years excluding IFRS 16
In thousands of euros

Dec. 31, 2023

Dec. 31, 2022

Dec. 31, 2021

Acquisitions of intangible assets(4,114)(5,526)(18,583)

Acquisitions of property, plant and equipment(14,896)(16,971)(13,820)24 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportPRESENTATION OF THE GROUP _ 1
Financial performance

1.8 FINANCIAL PERFORMANCE€529 M GROUP SALES IN 2023, INCLUDING€313 M FROM ESSENTIALS PRODUCTS(+4.5% at constant exchange rates)

3 TARGET ANIMAL SPECIESDOGS, CATS AND CATTLE
Sales: 70% petsand 30% livestock

3 STRATEGIC TERRITORIES

47% Europe,
38% Americas and
15% Asia-Pacific

EBITDA : €113 M
21.3% of sales

Strong cash flow
generation: €89 M

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 25

1 ­_ PRESENTATION OF THE GROUP
Non-financial performance

1.9	NON-FINANCIAL PERFORMANCE
Labels and certificationsGaïa Rating 2022: 60/100 stablevs 2021, in line with benchmark index

Employer commitment
Further growth
for the company

TALENT DEVELOPMENT

72,000 hours of training 59,000
98% of employees trained in 2023 95
vs.

in 2022vs.

DIVERSITY AT WORKin 2022Social commitment

2,483

employees vs. 2,524 in 2022

People with disabilities

Have a positive impact
on our stakeholders
Stakeholder relations

3.90% of France workforce

Employees/Customers/Corporate bodies/
Shareholders/Suppliers/Partners

Responsible purchasing

Employees worldwide

Strengthen the system and train buyers

23%

Asia/Pacific54%

EuropeEnvironmental commitment
Continue to limit our impact
on the environment

23%

Americas

RECRUITING TALENT

98% permanent contracts
48% women 47%
vs.

in 202226 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Impact measure
Total GHG emissions

Scopes 1 and 2

Carbon footprint in tonnes

9,585

Carbon intensity per €M

31.8

PRESENTATION OF THE GROUP _ 1
Simplified organizational chart

1.10 SIMPLIFIED ORGANIZATIONAL CHART
Section 1.2 provides an overview of the Group's business.
Vetoquinol is organised around its parent company, Vetoquinol SA, which acts as a holding company for the Groupand also operates a business in its own right.

The executive functions are centralised in the parent
company, Vetoquinol SA.
The organisational structure of the Vetoquinol Groupremained unchanged in 2023.

The Group’s principal industrial site is located in Lure,
where its head office is also situated. The company(Vetoquinol SA) invoices its subsidiaries for the finishedproducts that it manufactures.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 27

1 ­_ PRESENTATION OF THE GROUP
Simplified organizational chart

The Vetoquinol Group's simplified organization chart at December 31, 2023 is as follows:

100%

100%

100%

100%

Holding France
VETOQUINOLINTERNATIONAL
SAS

100%

99.97%

100%

South Korea
VETOQUINOLKOREA Co., Ltd

100%

FranceVETOQUINOL SA

100%

100%

HoldingHong-Kong
FREFIN ASIA Ltd.

China
100%
VETOQUINOL
TRADING(SHANGHAI) CO., LTD

100%
100%

CanadaVETOQUINOL
N-A Inc
99.9%

USA
VETOQUINOLUSA Inc
MexicoVETOQUINOLDe MEXICO SA
de CV

28 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

100%

100%

Holding Brazil
VETOQUINOLDo BRAZILPARTICIPACOES Ltda

Holding Mauritius
FREFIN
MAURICIUS Ltd

United Kingdom
VETOQUINOL
UK LtdUnited Kingdom
FARMVETSYSTEMS Ltd.

PolandVETOQUINOLBIOWET Sp Z.o.o

Italy
VETOQUINOL
Italia srl

Portugal
VETOQUINOLUNIPESSOAL Lda

Spain
VETOQUINOLESPECIALIDADESVETERINARIAS SA

SwedenVETOQUINOL
SCANDINAVIA AB

100%

Netherlands
VETOQUINOL BV

99%

Belgium
VETOQUINOL NV

99%

BrazilVETOQUINOLSAUDE ANIMAL
Ltda

India
99% VETOQUINOL India
Animal HealthPrivate Ltd

100%

100%

Irleand
VETOQUINOL
Ireland Ltd

Holding Germany
FREFIN GmbH100%

Germany
VETOQUINOL GmbH100%

Czech Republic
VETOQUINOL SRO

100%
100%

Switzerland
VETOQUINOL AG

100%

Japan
VETOQUINOL –Japan K.K.

100%

100%

New Zealand
VETOQUINOLNEW ZEALAND Ltd

Australia
VETOQUINOL
AUSTRALIA
Pty Ltd Inc

Austria
VETOQUINOLOSTERREICH GmbH

2
STATEMENT OF NON-FINANCIAL PERFORMANCE
2.1	SUSTAINABLE DEVELOPMENT AT THE HEARTOF VETOQUINOL'S STRATEGIC PLAN

30

2.2	CORPORATE SOCIAL RESPONSIBILITY: A PILLAR
OF VETOQUINOL'S STRATEGY

31

2.3

MATERIALITY MATRIX

32

2.4

GREEN TAXONOMY

33

2.8

ENVIRONMENTAL FOOTPRINT

52

2.8.1
2.8.2
2.8.3
2.8.4
2.8.5

Pollution preventionWaste managementSustainable use of resources: water and energy
Environmental protection
Protection of biodiversity

52
53
55
58
60

2.9

OUR PRODUCTS

60

2.6.1	HSE - A core department for the group and its management 
2.6.2 Group HSE standards
2.6.3 Managing HSE risks

38
38
38

2.9.1 R & D process overview
2.9.2 Vetoquinol Group R&D strategy
2.9.3 Organization of Vetoquinol's scientific division
2.9.4 Overview of current R&D programs
2.9.5 Dependence on human health research to develop new molecules
2.9.6	Antibiotics for veterinary use and antibioresistance: commitment
to the rational use of antibiotics in animal health
2.9.7 Eco-friendly products

2.7

VETOQUINOL’S PEOPLE

39

2.10 SOCIAL FOOTPRINT

2.7.1
2.7.2
2.7.3
2.7.4
2.7.5
2.7.6
2.7.7
2.7.8

Headcount analysis at December 31, 2023
Health and safety in the workplace
Attractiveness of the Group
Recruitment, induction and compensation
Organization of staff dialogue
Training and skills developmentNon-discrimination and equal opportunities
Working hours

40
43
46
48
49
50
51
52

2.10.1 Territorial, economic and social impact of the group’s business65
2.10.2 Animal welfare66
2.10.3 Humans and animals: a lifelong relationship
67
2.10.4 Ethics and fair practices68
2.10.5 Supplier relations69

2.5	VETOQUINOL‘S SUSTAINABLE DEVELOPMENT GOALS

34

2.6	OVERALL HEALTH, SAFETY AND ENVIRONMENTAL
POLICY37

60
61
62
63
63

65

64
64

2.11 EUROPEAN GREEN TAXONOMY

70

2.12 SUMMARY TABLE OF NON-FINANCIAL INDICATORS

73

2.13 REPORT BY THE INDEPENDENT THIRD-PARTY BODY

76

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 29

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Sustainable development at the heart of vetoquinol's strategic plan

2.1	SUSTAINABLE DEVELOPMENT
AT THE HEART OF VETOQUINOL'SSTRATEGIC PLAN
The activities, products, services and solutions offered
by Vetoquinol are all designed to improve the welfare ofanimals and their health, which in turn benefits mankind.
Sustainable development is at the root of our societal,
human and environmental concerns, and is aligned with
our vision: to be by 2033 "the most agile animal healthcompany where employees, experts, partners and customers together create customized solutions dedicatedto animal health for a better planet".
Our strategic plan is built on a roadmap that is both ambitious and demanding. At the heart of this plan is thegoal of sustainable development. Our Board of Directors
oversees the Group's Corporate Social Responsibility (CSR)
roadmap, identifying key issues and allocating resources
to enable our teams to implement the necessary actions
and achieve the goals we have set ourselves. Our objectives are structured around the following themes, which
form the backbone of our CSR actions.
The safety of our employees is our top priority. We arecommitted to maintaining a safe and healthy work environment and aim to establish a culture of shared vigilancein this area. We are working to control our carbon footprint
and reduce CO2 emissions per million euros of sales overthe life of our strategic plan. As part of this commitment,
we conducted a comprehensive carbon assessment
in 2023, including scope 3. Our goal is to reduce industrial waste and increase the amount of recycled waste.
We are pursuing our eco-design and packaging management approach for our products and continuing to rollout our sustainable, ethical, and responsible procurement
policy. Finally, the management of water as a sustainable
resource is now a key issue for our company, against a
backdrop of climate hazards and the need to preserve
this critical and strategic resource.
As we enter a new era that will place greater demands
on transparency in the field of sustainable development,
we reaffirm our company’s commitment to playing a
responsible role in this area. We are dedicated to a longterm and sustainable vision, which we share with our
employees, customers, and all other stakeholders.

Matthieu Frechin
Chairman and Chief Executive Officer

30 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Corporate social responsibility: a pillar of vetoquinol's strategy

2.2 C
 ORPORATE SOCIAL RESPONSIBILITY:A PILLAR OF VETOQUINOL'S STRATEGYOne of our core strategic principles is our commitment
to sustainable development. We are responsible foroverseeing the implementation of the objectives andaction plans we have set ourselves in this area.
The Group Leadership Committee, comprising the Group's
operational and functional managers, is responsible foroverseeing the implementation of Vetoquinol's strategy.
On a quarterly basis, all elements of the strategy arereviewed, the progress of initiatives is monitored, andcorrective action is taken where necessary. A summaryis prepared and presented to the Group's Board of Directors, which oversees the implementation of the Group's
strategy.

Aligning Vetoquinol managers' objectives with CSR
challenges
Vetoquinol's management teams, from the Group Leadership Committee to the subsidiaries' management
committees, are dedicated to addressing CSR issues. This
commitment is reflected in the allocation of a portion of
their variable compensation to the achievement of quantifiable CSR objectives. In 2023, these objectives werebased on a number of accidents reflecting our progressin terms of workplace safety, a target for CO2 emissions(Group scope, Scope 1 and 2) per thousand euros ofsales, and the achievement of progress indicators for theGroup's sustainable development plan.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 31

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Materiality matrix

2.3 MATERIALITY MATRIXHighIn order to facilitate continuous improvement and to complete its approach to social and environmental responsibility,
the Group has drawn up a materiality matrix. The result of an independent analysis and internal review by the Group Executive Committee, the materiality matrix is presented below.


Mastering ourcarbon footprint

HUMAN

ENVIRONMENTCUSTOMERSAND VALUE CHAIN



Preservation
of waterand energy
resourcesGreenand easy
PackagingPrevention, health and safety at work
Maintaining corporate culture
SustainabilityAutonomy and empowerment
BiodiversityProfessional development
Job quality,compensation
and benefits
SkillsmanagementInvolvementof employees inactions to benefit
communities


Risk-based approachOperational excellence
Data Security
Controlling
our effluentsand waste

Low

GOVERNANCE


AnimalwelfareIMPORTANCE TO VETOQUINOL’S STAKEHOLDERS
One HealthCustomer satisfaction and listeningProduct quality and pharmacovigilanceFight against antibiotic resistanceInnovation and co-construction of solutions
Ethics and compliance

High

Low

IMPORTANCE TO VETOQUINOL
Issue title

Description and action

Managing our carbon intensity

Reduce CO2 emissions per million sales scope 1 and scope 2. Estimate scope 3
emissions and identify emission reduction action plans.

Animal welfare

Vetoquinol adheres to the five "fundamental freedoms" which describe society's
expectations regarding the living conditions of animals when they are underhuman care.

One health

Vetoquinol's commitment to animal health and welfare helps to limit thephenomenon of zoonosis and promote a sanitary context conducive to sustainable
development.

Customer satisfaction and listening

Conduct customer satisfaction surveys.

Product quality andpharmacovigilance

A systematic quality approach has been implemented for all human resources used
for this purpose. For every two people in production, there is one in quality assurance
or quality control.

Combating antibiotic resistance

Vetoquinol is fully committed to combating antibiotic resistance. We do notmarket antibiotics used for growth promotion and we support veterinarians in theprescription and proper use of anti-infectives.

Innovation and co-construction ofsolutions

To be the most agile animal health company where stakeholders work together
to create customized solutions.

Ethics and complianceManage the Group's risks and ensure compliance with the standards applicable to its
environment, particularly with regard to ethics and anti-corruption.

Prevention, health and safety at work Establish a shared culture of vigilance throughout the Group.

32 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Green taxonomy

Methodological note
The materiality matrix presented above was prepared asfollows:
After mapping all of Vetoquinol's stakeholders, as
outlined in section 2.5 of the DPEF (Déclaration de Performance Extra-Financière), it became evident that the
primary stakeholders are customers, partners, suppliers,
employees, and investors. CSR issues have therefore been
defined based on the expectations of these stakeholders.
Our interactions with investors provide a clear indicationof these expectations, particularly through the meetings
held throughout the year and the questionnaires they
may send us. Additionally, the CSR expectations theyexpress are a valuable source of insight. Furthermore,

the working groups run by MiddleNext and Vetoquinol's
membership of various professional bodies facilitate thesharing of societal expectations. The issues were rated
through interviews with the relevant departments, using
an iterative approach. The analysis was linked to the risk
approach. The matrix was validated by the Executive
Committee. This approach enabled us to formalize our
CSR commitments and set the related indicators. In 2022,
the materiality matrix was updated in light of the launchof the new "Ambition 2026" strategic plan, which includes
ambitious sustainable development objectives. In 2023,
there were no significant developments that necessitateda revision to this materiality matrix.

2.4 GREEN TAXONOMY
The European Union (EU) has published European Regulation 2020/852 of June 18, 2020 (known as the "Taxonomy"
Regulation) on the establishment of a framework topromote sustainable investments within the EU.
Upon examination of the new Delegated Regulation (EU)2023/2485, which amends the Climate Delegated Regulation (EU) 2021/2139, and the new Delegated Acts (EU)2023/2486, relating to the other four environmental
objectives, it has been confirmed that none of our activities contribute substantially to these regulations.
Please be aware that Annexes I and II provide definitionsof eligible activities, including the corresponding Statistical Nomenclature of Economic Activities in the European
Community (NACE) codes, as well as the technical criteria
for qualifying them as effectively sustainable according
to the taxonomy regulation. Consequently, activities that
do not meet these definitions are considered undefined in
the reference framework (and therefore ineligible).
Vetoquinol is a leading research, development, manufacturing, and marketing company in the veterinary
medicines industry. These activities are not currently
considered to make a substantial contribution to the two
climate objectives defined by the taxonomy.
Presentation of key performance indicators required forfiscal 2023
It is anticipated that sales of veterinary specialties will befully captured by the Taxonomy under the pollution prevention and reduction objective. Vetoquinol is therefore
presenting 100% of its sales as eligible for the taxonomy.
Capital expenditure indicator (or CapEx)

Capital expenditure also includes new assets resulting
from business combinations carried out during the year.
Eligible capital expenditure includes:• r elated to potentially sustainable activities•p art of a plan to make or expand a business sustainable• linked to economic activities referred to in the Taxonomy
as "eligible individual measures" aimed at reducing thecompany's environmental footprint, such as expenditureon premises, vehicles and data hosting.
In accordance with Delegated Regulation (EU) 2021/2139
of June 4, 2021, the Vetoquinol Group's activities do notmeet the criteria for substantial contribution to the firsttwo environmental objectives. As a result, they are not eligible for consideration. Only capital expenditure related toindividual measures can be considered.
In 2023, the Vetoquinol Group conducted a comprehensive review of capital expenditures (CapEx) invested inall group subsidiaries, excluding those related to IFRS
16. The methodology employed involved a multi-criteria
analysis of CapEx, with the financial materiality of theinvestment, the nature of the investment, and the eligibility of the retained investments all taken into account.
The total amount of eligible capital expenditure (CapEx)
identified and validated for the 2023 financial year is€1,367,000, representing 7.2% of the Group's total CapEx
for that year.
The table presented in section 2.11 has been updated toalign with the company's management approach, which
excludes the accounting impacts of restatements associated with IFRS 16 from an operational standpoint.

The CapEx to be considered corresponds to new acquisitions of tangible and intangible fixed assets during theyear, before depreciation, amortization, or revaluation.
This means that new rights to use leased assets aretaken into account as soon as the leases are signed, andnot the financing terms.
Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 33

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol‘s sustainable development goals

Operating expenses indicator (or OpEx)
The OpEx (adjusted for IFRS 16) to be considered include
those:• r elated to eligible activities,• Vetoquinol's sustainability objectives as part of a plan toexpand or make a business sustainable,•
related to economic activities called "individual
measures" in the Taxonomy aimed at reducing the company's environmental footprint, such as expenditure on
premises, vehicles and data hosting.
It should be noted that not all operating expenses need
to be taken into account. Only research and development costs, building renovation costs, short-term leasing
charges, asset maintenance, upkeep and repair costs,
and any other direct expenditure relating to the day-to-day
upkeep of tangible assets required for their proper operation should be taken into account.
In accordance with the terms of Delegated Regulation(EU) 2021/2139 of June 4, 2021, the Vetoquinol Group's
activities do not contribute substantially to the first twoenvironmental objectives. Consequently, they are noteligible for funding. Only operating expenses related toindividual measures can therefore be taken into account.
The Vetoquinol Group has not incurred any operating
expenses under these individual measures in 2023.
Consequently, the proportion of the Group's OpEx
expenses relating to economic activities aligned with thetaxonomy is 0%.
As in 2022, a study was conducted on the OpEx and
CapEx for buildings and cars to identify any potentialalignment. Following a comprehensive methodologicalstudy and a review of the questionnaires prepared for thispurpose, which are listed below, the three indicators of
the green/European taxonomy for the 2023 financial year
are as follows:• share of eligible sales: 100% ;• eligible OpEx share: not significant and carried forward0% ;• share of aligned CapEx (excluding IFRS16): 7.2%.

2.5	VETOQUINOL‘S SUSTAINABLE
DEVELOPMENT GOALSIn September 2015, 17 Sustainable Development Goals(SDGs) were adopted by 193 UN countries. Also known as
the "Agenda 2030", this program aims to transform society

by eradicating poverty and ensuring a just and inclusivetransition to sustainable and global development.

This report was drawn up after an analysis of the SDGs was carried out for the Vetoquinol Group.

34 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol‘s sustainable development goals

Vetoquinol's sustainability objectives are as follows:

Ensure a healthy working environment for all Group employees and develop and promote
decent working conditions.
Hire, train and develop Vetoquinol people with a focus on internal promotion.

Ensure gender equality.

Ensure reasonable water consumption and control the treatment of wastewater.

Optimize energy consumption and develop the use of renewable energy.

Innovate by researching, developing and bringing to market new drugs/therapies, services
and solutions, whether disruptive or incremental; develop the related skills.
Incorporate sustainable development factors into the industrial production and distributionof our products.
Control Vetoquinol’s carbon footprint.

Develop and promote ethical business practices.

They contribute to the fulfillment of Vetoquinol's mission: "Enriching human life through dedication to animal health andwelfare".

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 35

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol‘s sustainable development goals

The Vetoquinol Group's dialogue with its stakeholders is summarized in the infographic below:

PUBLIC• ESAT• Centraide• Media•G overnment
and municipalities•C harities, socialand environmental NGOs
• Neighbours/residents•E mergency services

RESEARCH& DEVELOPMENT• Veterinary schools• Universities• Recognized experts• Laboratories, INRA, INSERM• Biotech

FINANCIALCOMMUNITY

STAFF• Employees•S taff representative bodies•M anagement and employee
representatives• Interim agencies/recruitment• Training partners• Shareholders• Investors• Analysts• Ratings Agency• Auditors• Euronext/MiddleNext

INSTITUTIONSPARTNERS• Suppliers• Lessors/tenants• Banks

CUSTOMERS• Vets/clinics/pharmacies• Breeders• Pet owners• Retailers/wholesalers• Key Accounts

36 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report• AFSSA• DGM/EMEA/FDA• Eurostat•N ational agencies• AMF•H
 ealth for Animals• DREAL• SIMVSTATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Overall health, safety and environmental (HSE) policy

2.6	OVERALL HEALTH, SAFETY ANDENVIRONMENTAL (HSE) POLICYThe Group's HSE function is responsible for defining
the health, safety, and environment policy, which is thenimplemented in all Vetoquinol entities and plants worldwide.
The Group's HSE policy is based on 12 fundamental principles deployed throughout the Group.
• An HSE representative is appointed within each entity.
The individual in question reports directly to local management and functionally to the Group HSE manager.
He/she oversees the implementation of local risk prevention programs and ensures compliance with Groupregulatory requirements and standards.
• In addition to the Group HSE policy, each entity is responsible for defining a local HSE policy that is tailored toits specific challenges and activities. It must be signed
by local management and explained to all staff.
• Each entity has implemented an HSE risk assessment
process, which incorporates road risks in particular. The
process covers all activities carried out by employees
and those carried out by external service providers on
a Vetoquinol site. The process also includes an assessment of risks associated with malicious acts.
• Once the risk assessment process is complete, a formalrisk reduction plan is created. This plan is subject toregular monitoring and updates.
• In the event that avoidance of a risk is not possible, itis preferable to implement source protection measuresthat protect all exposed employees over the use of personal protective equipment.

• In the case of a new product project or activity, the HSE
risk assessment is carried out as far upstream as possible in order to integrate the appropriate measures.
• A plan to measure exposure to physical and chemical
nuisances is implemented for personnel concerned. The
results are incorporated into the periodic medical surveillance program.
It is the responsibility of all staff to receive regular•
HSE training in relation to risks and activities. All new
employees receive HSE awareness training on their firstday of work.
• A process for collecting and analyzing accidents andincidents is implemented within each entity. Any significant accident or incident is to be immediately reported
to the Group HSE manager, who will then coordinate feedback from other entities.
• Safety indicators are monitored on a regular basis withineach entity. Environmental indicators have been established for industrial units, including waste monitoring,
effluent discharges, water and energy consumption.
• Each entity is responsible for defining a program of field
HSE inspections and observations. This program encompasses all activities involving Vetoquinol employees.
•Each entity ensures the availability of the necessary
resources to effectively manage HSE emergencies, suchas injury or pollution, as well as an appropriate crisis
management organization.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 37

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Overall health, safety and environmental (HSE) policy

2.6.1	HSE - A core department for the group and its
management
Vetoquinol's HSE function is structured as a network.
Each Vetoquinol entity is covered by a legal manager anda local HSE representative. The legal manager is delegated by the Group to implement Group HSE policy andlocal regulations.
The network is organized as follows:• The Group HSE Manager proposes Group HSE policy
and coordinates its deployment. He conducts periodic
audits, defines standards, consolidates performanceindicators, provides support and expertise, and coordinates the HSE network by promoting the sharing ofexperience. Over the past two years, due to the impact of
the COVID-19 crisis, all Group entities have been auditedon the basis of documentation and interviews (digital/
remote). In 2023, a full on-site audit was carried out. In
2024, three full on-site audits are scheduled.

2.6.2

A safety reporting process has been established for all
Group entities. Information is reported monthly for industrial units and quarterly for sales units. This process isbased on the risk pyramid concept, which tracks thenumber of accidents, first aid cases, near-misses, andhigh-risk situations (see 2.7.2.5 Occupational Health and
Safety Indicators).

Group HSE standards

An internal HSE referential (diagnostic tool) has been
defined to facilitate the deployment of the Group's HSE
policy within the various Vetoquinol entities. It outlines a
set of best practices for managing and operating in key
areas of HSE management. All Group entities have been
audited over the past three years. A defined action plan is

2.6.3• The Industrial Directors (industrial entities) or Country
Directors (commercial entities) are responsible for
implementing Group standards and programs within
their respective entities.
•Over 25 local HSE representatives or coordinators
oversee HSE activities within their industrial and commercial entities, in compliance with local regulations
and internal standards, and report to the Group HSE
manager.

in place for each audited entity, with progress monitored
at least quarterly. In between audits, follow-up visits are
conducted to industrial sites to ensure that the action
plan is up to date and any necessary adjustments can be
made. All industrial and commercial entities have been
audited over the past two years.

Managing HSE risks

List of main HSE risks• Industrial risk of fire or explosion in a workshop or
warehouse, mainly linked to the storage and use of flammable liquids and combustible powders.
• The risk of serious injury or occupational illness due
to factors such as handling hazardous substances,
working on machines, operating machinery, handling or
moving around on site.
• Environmental risk linked to effluent and atmosphericemissions, waste, consumption of natural resources or
accidental pollution.
• Legal risk associated with non-compliance with HSE
regulatory requirements.

38 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

The Group places a high priority on managing health andsafety risks and environmental impacts as part of a continuous improvement process.
The Group places a high priority on employee HSEtraining, with regular awareness-raising campaigns
conducted in all sectors. Upon joining the Group, each
new employee receives HSE training from the very firstday on the job. Given the nature of their work, it is of theutmost importance that employees receive training in therisks associated with the products they handle.
Local procedures and operating methods are in place,including those concerning the wearing of personal
protective equipment, traffic rules, waste sorting, and hotspot work. All employees receive regular training in theapplication of these procedures.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol's people

In addition, any external company working on the Company's premises must comply with the HSE procedures
and instructions of the relevant site. Prior to any intervention, a Prevention Plan or the local equivalent is prepared,
as applicable.
HSE regulations are monitored in each country by the
local HSE representative or coordinator.
A comprehensive risk assessment of each workstation isconducted at the design stage and on a regular basis thereafter. Collective protection measures are the preferred
option over personal protective equipment.
The company places particular emphasis on the wellbeingof employees who are at risk of exposure to carcinogenic, mutagenic, and reprotoxic (CMR) raw materials. At
the same time, the Group is committed to reducing theserisks.

Periodic internal HSE inspections of premises are
conducted, and corrective action is taken where necessary. A health, safety, and environmental information,
preventive maintenance plan has been developed for key
health, safety, and environmental equipment (fire-fighting
equipment, ventilation systems, lifting equipment, etc.) ateach site.
Each site has the requisite human and material resources
to deal with emergency situations, and regular training
is provided to ensure that staff are fully prepared. For
production sites with an emergency plan, managers andtechnicians responsible for implementing the plan receive
regular in-house training in immediate measures. As partof our risk management strategy, we conduct regularcrisis simulation exercises. The post-exercise analysis
allows us to capitalize on the critical actions taken andimprove the reliability of the Group's Business Continuity
Plan (BCP).

2.7 VETOQUINOL’S PEOPLE

Regarding our workforce, 2023 is a continuation of 2022.
• Our commercial and production activities saw a return
to a more normal level of activity in 2022 and 2023, after
a period of sharp increases during the Covid-19 pandemic in 2020 and 2021.
• In 2021, we initiated a project to overhaul our ERP (Enterprise Resource Planning) system in 10 countries. This
project has entered the routine phase in 2023. This
explains the termination of the contracts of employees
on fixed-term contracts who had been recruited toreplace the staff involved in this project.

The aforementioned teams, on fixed-term contracts, left
our employ during 2023 and were therefore no longer partof our workforce at 12/31/2023.
The combination of these two factors resulted in a slight
reduction in our workforce size at 12/31/2023 comparedto 12/31/2022.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 39

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol's people

2.7.1

Headcount analysis at December 31, 2023

2.7.1.1 2023 changes in headcounton the previous year. The impact varies by continent andbusiness family. For instance, our sales and marketing
teams have been bolstered, while our supply chain andpurchasing departments have also seen growth.

As of December 31, 2023, the Group employed 2,483 individuals, a decrease of 41 from the end of December 2022.
The headcount is therefore stable, down slightly by 1.6%

BREAKDOWN OF HEADCOUNT (PERMANENT AND FIXED-TERM CONTRACTS) BY STRATEGIC TERRITORY
Permanent contracts 2022

2,524

2,483

69

Permanent contracts 2022

43

Permanent contracts 2023
Permanent contracts 2023

1,391
52

1,339

1,328
2,455

30

1,298

Europe

10

574

576

564

572

Americas

The number of employees on permanent contracts
remains stable at the Group level. The post-Covid market
is having an impact on our commercial and industrial activities, prompting us to exercise caution when recruitingfor vacant positions.
The slight decline of 1.6% in the total workforce (permanent and fixed-term contracts) is primarily attributable to
the reduction in fixed-term contracts. By the end of 2023,
we had reduced the number of fixed-term contracts within
the Group by 38% (from 69 to 43). The majority of these
reductions were made up of employees on fixed-term
contracts directly or indirectly linked to our ERP redesign
project. Furthermore, we have converted a number of
fixed-term contracts into open-ended ones.
Furthermore, the composition of our workforce varies bycontinent.
In Europe, the total number of employees on permanentand fixed-term contracts decreased by 4.5%. This was

40 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

4

7

559

579

552

570

Asia/Pacific

2,440

9

Total

the continent most affected by the combined impact ofslower growth in the post-Covid animal health businessand the conclusion of the fixed-term contracts we had
previously utilized for the ERP project. The number ofpermanent employees decreased by 3.1%. France, with
the Group's largest workforce, also experienced a 3.1%
decline in permanent staff.
The majority of our workforce growth occurred in the
Asia-Pacific region. The number of permanent staff
increased by 3.4% as we continued to expand in India.
In North and South America, the workforce grew by 1%,
with the majority of this growth occurring in the UnitedStates and Canada.
The United States, the world's leading market for animal
health products, has seen an increase in sales activity
and is strengthening its sales force.
In our other continental subsidiaries, headcount is down,
particularly in Brazil and Mexico.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol's people

2.7.1.2 Breakdown of headcount by department (permanent and fixed-term contracts)- 1.6%
2,524 2,483
2022
2023

+ 0.9%
1,124 1,134- 3.5%
395- 4.8%

381

Administration

336
Sales
& Marketing

320

Production

Vetoquinol strives to control its entire value chain, fromR&D (new drug development) to production and marketing. However, we occasionally engage in partnerships or
subcontracting to gain access to technologies we do notpossess in-house.
We have observed a 2.6% increase in the Supply Chain &Purchasing population, as well as a 0.9% rise in the Sales& Marketing professions, due to recruitment linked to themid-2020 acquisition of Drontal® and Profender®, thelaunch of Felpreva in Europe and the development of oursales forces in Asia-Pacific.

- 8.4%
227

208

Quality- 3.8%
211

203

Science+ 2.6%
231

237

Supply chain& procurement

Total

The conclusion of fixed-term production contracts inFrance and the realignment of our workforce at our plantin Brazil resulted in a 13.2% reduction in our Production
and Quality headcount. These two professions are closely
linked in the pharmaceutical industry, which requires ahigh ratio of quality specialists (approximately one quality
employee for every two production employees).
The number of employees in other professions (administration, scientific) also declined between 2022 and 2023.
It is also worth noting that by 2022, we had recruitedemployees on fixed-term contracts in almost all ourbusinesses and in around ten countries to replace staff
who had been mobilized on our ERP overhaul project.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 41

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol's people

2.7.1.3 Breakdown of headcount by gender and territory
Headcount

EuropeWomen

AmericasAsia-pacificConsolidated total

809

321

67

1,197

61%

56%

12%

48.2%

Men

519

255

512

1,286

39%

44%

88%

51.8%

TOTAL

1,328

576

579

2,483

53.5%

23.2%

23.3%

100.0%In India, our largest sales force globally is exclusively
male due to local working conditions and culture. This isoffset by a more female-dominated population in Europe.
On a like-for-like basis, excluding India, the female
workforce remains the most represented within the Group(59.3%).

The gender balance within the Group is maintained ata balanced level. The gap is narrowing year on year. In
2020, 45% of our employees were women. This increased
to 46% in 2021, 47.5% in 2022, and 48.2% in 2023.

2.7.1.4 Age breakdown by gender> 60 years

56

Average age:87

56-60 years

40 years

90

51-55 years

147

178
216

158

36-40 years

208
147

31-35 years

132

26-30 years

150

100

50

The age pyramid is noteworthy for its impact on the male
workforce, with India playing a significant role in the rejuvenation of the male pyramid, with a high proportion of
employees in the 26-35 age bracket. The female pyramid
more closely aligns with the Group's age groups, with ahigher proportion of 36-45 year-olds. This is not unexpected for an international company with over half its
employees based in Europe.

2

0-20 years
0

1,197

38

21-25 years
3200

43 years

41-45 years

264

250

130

161

96

300

Average age:103

46-50 years

224

1,286

43

0

50

100

150

200

250

The breakdown shows minimal change compared to2022. 21.5% of employees are under 30, a slight increase
from 22.5% in 2022, while 20.5% are over 50, a slightdecrease from 19.6% in 2022. The average age within theGroup is 41.3, representing a slight increase from 40.8 in
2022.
The average duration of employment is 8.1 years, representing a marginal increase from 2022's 7.8 years.
For acquired companies, the seniority of integrated
employees is taken into account.

42 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol's people

2.7.1.5 Breakdown by professional category- 1.7%

2022

2,524 2,483

2023

-3.3%

+ 4.7%- 3.0%

780 755703 738728 707- 10.6%313 283

Managers

Sales force

Technicians,
office staff

As our sales force continues to develop to support our
new brands, we have nearly equal representation of thethree professional categories of managers, technicians,
and sales forces in terms of headcount. The pharmaceutical industry requires a significant number of managers,
laboratory technicians, and administrative technicians tooversee production and development activities. Given thehigh level of skills required in the pharmaceutical industry,
the proportion of employees in the "blue-collar" category
is relatively low. Furthermore, Vetoquinol subcontracts a

2.7.2

Manualworkers

Total

portion of its production to companies that possess technologies not held in-house.
The decline in the number of "Manual" and "Technical"
employees is primarily attributable to a reduction in production volumes at our facilities and a highly competitive
job market, which is prompting some of our employees,
particularly in Poland, to seek new opportunities.
The majority of the increase in the sales force category
was in the United States and India, where we are continuing to expand our commercial presence.

Health and safety in the workplace

2.7.2.1 Health crisis management
The prevention policy initiated during the Covid-19 crisis
continued into 2023. Each entity and the Group level had
a crisis and health watch unit in place. Sanitary measures were adapted to the evolving epidemic situation.

These included maintaining barrier gestures, wearing
masks, gauges in communal areas, daily cleaning, travel
restrictions and the continuation of telecommuting forcompatible positions.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 43

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol's people

2.7.2.2 Vigilance behavioral program
Our accident prevention policy places a significant
emphasis on the individual behavioral aspect and managerial leadership. To this end, we have implemented aninternal program called Vigilance within the Group since
2018. The objectives of this program are twofold: to foster
the commitment and visible involvement of the managerial line in safety matters and to enhance the awarenessof all employees regarding the importance of the behavioral factor in accident causes.
In 2023, we consolidated key activities within the Group,
bringing us closer to the objective of a safety culture of
Shared Vigilance. Each manager or employee is required
to intervene in the event of any risky behavior observed
through the practice of safety dialogue.
In line with the Group's vigilance activities, and in order toincrease everyone's vigilance, we held a specific workshop
on road risk in India. The objective was to increase awareness of road risks and develop an action plan to address
this specific risk.

2.7.2.3	Specific actions carried out
in 2023
As in previous years, a number of preventive actions werecarried out in 2023 at the Group's various sites. These
included• In Gorzow, Poland, the continued installation of fire
detection systems, as well as the ongoing replacementof production lighting fixtures.
• In Magny-Vernois in France, the deployment of a sprinkler-type fire protection network on industrial premises,
the installation of electric charging stations, and thereplacement of obsolete air-conditioning equipmentwith more energy-efficient, higher-performance units are
ongoing.
• In Princeville, Canada, the relocation of gas cylinderstorage and improvements to chemical filling stations
have enhanced personal safety, while the sustainable
development study and waste mapping have reduced
the amount of waste generated.
• In Tarare, France, we implemented several energy-saving measures, including the installation of heat pumps,
relocation of the nitrogen supply network outside theproduction area, addition of air handling units, and replacement of lighting.

44 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report• In Goiânia, Brazil, we have implemented several measures to enhance safety and sustainability. These
include the replacement of lighting fixtures with low-energy alternatives, the provision of explosion risk training,
and the mapping of the site.
• At the corporate level, we are continuing to roll out Vigilance training programs, particularly within our sales
subsidiaries, and are disseminating new internal standards for field inspections.
• In 2023, the company invested €1,712,000 in HSE initiatives.
Road risk remains the primary cause of serious accidents for our employees. The road accident prevention
program, launched in France during 2017, has been rolled
out across a significant portion of the Group's entities.
The program continued into 2023. The program includes
a collective awareness-raising module, a driver charter forcompany vehicle beneficiaries, on-road driving training(safety and eco-driving), and exhaustive monitoring ofclaims with or without injuries.
At the Magny-Vernois site (the Group's headquarters
and the Group's largest facility in terms of size and activities), safeguarding employees' mental health is one of
the Group's prevention priorities. An RPS (Psychosocial
Risks) Committee has been in place for several years. The
committee is comprised of staff representatives, management, and the medical service. It convenes quarterly
or upon request to address emerging risks. A report on
its activities is presented at each CSSCT (Commission
Santé, Sécurité et Conditions de Travail) meeting. Furthermore, all managers have received training in RPS.
In 2018, the RPS Committee's missions were redefined,with a greater focus on prevention. This involves seeking
to reduce risk factors upstream or reduce harm to individuals. Concurrently, an RPS pre-diagnosis was conducted
to identify priority sectors and risk factors. In 2019, anin-depth diagnosis was launched within the various
departments of Vetoquinol SA, based on a methodology
validated by APAVE, with a multi-year schedule. Following
each diagnosis, a detailed action plan is created by thedepartment manager and monitored by the Vetoquinol SA
RPS committee. The process continued in 2023.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol's people

2.7.2.4 Health and safety agreements
French legislation currently requires companies
employing more than half of their employees in France
to implement an action plan or company-wide agreement aimed at eliminating or reducing legally-defined risk
factors.
Vetoquinol is not subject to this obligation, as less than
50% of French employees are exposed to these factors.

Nevertheless, in accordance with its Health, Safety andEnvironment (HSE) policy, Vetoquinol implements measures to limit the risk of illness and injury to its employees.
Three areas have been identified and are being addressed:• Handling• Repetitive work
• Night work.

2.7.2.5 Occupational health and safety indicators
Group Safety Pyramid

2023

2022

Number of lost-time accidents

6

13

Number of accidents without lost time

8

14

Number of first aid interventions

73

48

Number of near-misses
and hazardous situations

1,436

1,587

LOST-TIME ACCIDENT FREQUENCY RATE (LTAR OR TF1)

1.3

2.9

ACCIDENT AND FIRST AID FREQUENCY RATE (TAR OR TF3)

19.1

16.5

SEVERITY RATE

0.018

0.115

ANNUAL ACTION PLAN COMPLETION RATE

88%

78%

The frequency rate of lost-time accidents in the pharmaceutical industry in France is approximately 8(2019: Frequency Index = 14.1, or a frequency rate of
approximately 8). The average severity rate in the pharmaceutical industry in France is approximately 0.5,
according to AMELI data from 2019.
For Vetoquinol, the year 2023 shows a significant reduction in the total number of lost time accidents compared
to 2022 (6 vs. 13). The number of accidents without losttime is also down on 2022 (8 vs. 14).

Behavioral factors continue to be a significant contributing factor in these accidents, further demonstrating therelevance of the Vigilance program.
In terms of statistical indicators, the lost-time accident
frequency rate remains well below the French pharmaceutical industry average. The severity rate reflects thelow severity of injuries in the vast majority of cases.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 45

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol's people

The collection of dangerous situations and near-misses
continued in 2023. This is a highly encouraging outcome,as the proactive indicator at the "lower" part of the
pyramid enables us to take action upstream of accidents.
The overall completion rate for action plans in 2023
stands at 88%, exceeding the target of 55% set for theyear. This represents an excellent performance in thecontext of the health crisis, with a 10-point increase compared to 2022.
For 2024, Vetoquinol has set itself the targets of achieving a maximum of 10 lost-time accidents across theGroup as a whole, and collecting at least 1,200 hazardous
situations for the fourth year running. The emphasis will
be on the behavioral aspect..

2.7.3

2.7.2.6	Compliance with fundamental
ILO conventions
The Vetoquinol Group is committed to respecting theInternational Labour Organization (ILO) Declaration on
Fundamental Principles and Rights at Work. This includes:• Rejection of slavery and forced labor• Refusal of child labor• Ban on moral and physical harassment• Ban on all forms of discrimination in employment andoccupation (gender parity agreement)•Compliance with laws and industry standards on
working hours• Non-discrimination, equal opportunities.

Group attractivenessThe company's culture, human resources management
methods, and long-term family shareholding are key
factors in maintaining a stable workforce.

Maintaining positive labor relations within the Group's
various entities is a crucial aspect of implementing internal policy.

In 2021, numerous Group subsidiaries were honored withthe "Great Place to Work" certification. The United States,
the United Kingdom, Brazil, India, Belgium, the Netherlands, Scandinavia, and the Czech Republic. In 2023, oursubsidiaries in the USA, Brazil, and India received the"Great Place to Work" certification.

When acquiring companies abroad, the Group places
great importance on the quality and longevity of the
management teams in place.

In an increasingly competitive job market, these labels are
crucial for an international group of our size, which often
has entities located outside major cities.

46 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

The majority of Vetoquinol's sites are situated in suburban or rural areas, which allows employees to engage inoutdoor sporting activities during their lunch break, suchas walking or jogging.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol's people

2.7.3.1 Staff turnover

2.7.3.2 Absenteeism

Vetoquinol consolidates all staff movements across all
its entities on a monthly basis in order to monitor staff
turnover rates in particular.

Vetoquinol monitors absenteeism at all Group entities.
The company places a high degree of importance on analyzing data related to short and regular absenteeism. This
information can provide insights into employee well-being
and the potential for disruption within the company.

The turnover rate in India rose significantly, from 30.2%
in 2022 to 38.6% in 2023. This increase can be attributed to the dynamic post-Covid job market, as observed
elsewhere. Additionally, the animal health market is experiencing a surge in interest, with numerous Indian andinternational companies establishing or expanding theiroperations and recruiting talent to meet their needs.
Given these circumstances, we have chosen to segment
India from the rest of the Group, particularly as our Indiansubsidiary employs the Group's largest sales force.
Excluding India, the voluntary departure rate in 2023 was
8.7%, down from 9.6% in 2022. Although higher than the2019 pre-Covid rate (6.5%), the 2023 rate remains within
an acceptable range and is not unexpected given the
dynamics of post-Covid labor markets.
Including India, the Group's voluntary departure rate for2023 is 14.4%, higher than that for 2022 (13.5%) and 2019(pre-Covid), which was 11.3%.
We also observe a decline in the voluntary departure rate
in France (combined industrial and commercial sites),with a rate of 5.7% in 2023 compared to 6.5% in 2022. The
job market has stabilized, but remains vulnerable. Thislevel is not a cause for concern for the Group. However,current labor market conditions in the countries where
the Group operates are making it increasingly difficult to
recruit and retain skills.

The Group's overall absenteeism rate is 4.3%, a decrease
from 5.25% in 2022. Excluding maternity and paternity
leave, the absenteeism rate is 3.4% in 2023, down from
4.2% in 2022.
Absenteeism rates are analyzed with the managers andhuman resources officers of the entities concerned, andcorrective action plans are defined and implemented
where necessary.
The decline in absenteeism rates is largely attributable tothe initiatives undertaken by France in this area, including
awareness-raising and manager training programs.
Recent studies indicate that absenteeism in the French
private sector has been on the rise for several years, reaching an average rate of approximately 5% by 2022 (the2023 rate is not yet available).
The figures vary from country to country, but never reach
alarming levels in any of our subsidiaries. As is the casein many companies, absenteeism at industrial sites isslightly higher than in commercial functions, reaching
5.8% in 2023.
In France, all eligible fathers took advantage of their rightto paternity leave in 2023.

(*) The absenteeism rate includes illnesses that last less than 100 days
and absences due to workplace accidents.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 47

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol's people

2.7.4

Recruitment, induction and compensation

The attractiveness of the Group lies in its family values,
its corporate culture, its development projects, especiallyinternationally, its ambition, its broad scope of responsibility and its long-term viability.
The dedication of Vetoquinol employees is exemplified on
the company's LinkedIn page (https://www.linkedin.com/
company/vetoquinol), which boasts over 49,000 subscribers and showcases the Group's activities and daily
operations.
Vetoquinol makes a special effort to integrate new
employees into the company. Individualized induction
courses lasting several weeks are provided for managers
joining the company. Function managers in the subsidiaries typically participate in an integration program lastingat least a week at Group headquarters. Additionally, they
participate in international business seminars organizedby each Group function, which resumed in 2022 after a
two-year hiatus due to the pandemic.
The health crisis has presented an opportunity to significantly develop distance learning sessions. This isparticularly evident in the case of the induction sessions
that are regularly organised for all new employees. This
enables all new employees to gain a comprehensive
understanding of the company, its history and constraints,
the animal health sector, its professions, products, major
processes and corporate values: trust, dare, collaborate.
These values serve as a framework for guiding employee
behavior in their daily work. They facilitate collaboration
across diverse teams and contribute to more unified decision-making.
Vetoquinol's policies and values facilitate the smooth
operation of the company as an international group. They
serve as a set of shared standards for how employees
should work together and behave. It is the responsibilityof each individual to embrace these values and adhere tothem in order to maintain and enhance the Group's unique
identity and culture.
The company implements annual salary increases for its
employees, either independently or in accordance with asigned wage agreement with local social partners, whereapplicable.
In accordance with the legislation in force in different
countries, the Group may implement additional benefit
plans to provide employees with enhanced reimbursement conditions for healthcare costs and disability/deathcoverage.

48 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

2.7.4.1 Profit sharing
In France, the company has implemented a unique profit-sharing formula (amendment no. 2 dated June 29,2007) that is based on 5% of the company's operating
income.
This formula is only applicable when the resulting amountexceeds the amount calculated by the legal formula..

2.7.4.2 Incentive scheme
In 1987, a profit-sharing scheme was introduced in France
to involve all company employees in the smooth runningof the business.
A capping rule is applied to ensure that salaries above
2.5 times the annual Social Security ceiling do not
generate profit-sharing. This helps to more effectively
distribute the benefits of growth to middle managers,
technicians, workers, and employees.
Should the results exceed those anticipated at the beginning of the year, a supplementary payment may be made.
For 2023, management and the union delegation wereunable to reach an agreement on a new profit-sharing
agreement.
Management has chosen to limit the consequences ofthis situation by allowing employees to benefit from thevalue created, as has been the case since 1987. Consequently, we decided to pay a bonus for 2023 equivalent
to that which would have been paid under the proposed
profit-sharing agreement. The payment was made in
December 2023 for a total amount of €913,895.
In accordance with the terms of our various successive
profit-sharing agreements, it is explicitly stipulated thatthe sum of the Réserve Spéciale de Participation and theoverall profit-sharing envelope for any given year may notexceed 10% of gross salaries.
In addition to any existing legal provisions, certain
subsidiaries have established voluntary employee profit-sharing schemes within the Group.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol's people

2.7.5

Organization of staff dialogue

Vetoquinol adheres to local legislation on social dialogue.

2.7.5.2 Company savings plan

In France (Vetoquinol SA), employees were elected to theCSE (Comité Social et Économique) in 2022 for a fouryear term. The company has one trade union, the CFDT.

In France, the Company has a company savings plan
(PEE), established in 1989 and managed by Société Générale Gestion (S2G), Amundi, and CPR Asset Management.

In Poland, social dialogue continues with employee representatives elected by the workforce.

The PEE enables employees to invest their savings (profit-sharing, incentive, and voluntary payments) in sevendifferent mutual funds.

In Germany, the Works Council was renewed in 2022.
In Brazil, we collaborate with a union representing theGoiânia region, as there is no union presence in the plant.
The external union is responsible for negotiating collective agreements within the branch, particularly wage
revisions. They are permitted to enter the company premises to communicate with employees.
In other countries, our subsidiaries are generally below
the thresholds for establishing employee representation
bodies

2.7.5.1 Collective agreements
In France, one agreement was signed in 2023:• On July 6, 2023, an amendment to the agreement onnight work (the collective agreement to which thisamendment relates was signed on July 22, 2021).

2.7.5.3 Staff fringe benefits
In accordance with current French legislation, the Socialand Economic Committee oversees Vetoquinol SA'ssocial projects.
A secure website provides employees with up-to-date
information on all social and cultural activities, including
contributions to sports activities, trips, discount vouchers,
Christmas trees, various events, and more.
In Poland, companies with more than 20 employees
are required to set up a social fund. The social fund isgoverned by its own set of rules and is managed by a jointcommission.

The Princeville plant in Quebec regularly negotiates its
collective agreement in accordance with local legislation
governing unionized sites.
Until December 31, 2023, the agreement in force since
2018 remained in place.
Renewal negotiations for the new agreement are currently
underway.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 49

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Vetoquinol's people

2.7.6

Training and skills development

NUMBER OF TRAINING HOURS

97.9% of Group employees trained in 2023
FranceGroup (including France)

751 FTE

2,471 FTE

13,775 hours including 2,409 hoursof prevention and safety training

71,434 hours

Average workforce (full-time equivalent or FTE)
Total number of training hours
Average number of training hours per employee (FTE)

18.3 hours/employee

28.9 hours/employee

Average number of training hours per employee trained

22 hours/employee trained

29.4 hours/employee trained

84%

97.9%

Rate of employees trained

Vetoquinol is continuing its Group-wide skills development initiative.
The employee training coverage rate is calculated basedon the number of employees who have participated in atleast one training course during the year. Due to a highstaff turnover rate, some countries may have an employee
coverage rate higher than their average workforce. For
instance, one employee leaving may have been trained,
and one employee arriving in the same position may
also have benefited from at least one training session
during the year. The two figures represent one employee
on average over the year, but account for two employees
having received at least one training course. This explains
the very high training coverage rate, with 98% of Group
employees having received at least one training course in2023.
In 2022, Vetoquinol initiated a project with all Group entities to define a skills reference framework for each typeof function. The competency frameworks were integrated
into the annual performance review process in 2023 andwill also be utilized for employee recruitment and careerdevelopment.
The deployment of our LMS (Learning Management
System), called Vetoquinol Campus, has continued
according to a progressive schedule, as outlined with thevarious subsidiaries. Those involved in the initial deployment phase have chosen to integrate all or some of theiremployees on the platform, depending on their training
priorities for 2023. As a result, over 1,000 employees havecompleted more than 3,200 hours of digital training.
50 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

At the group level, we achieved 71,581 hours of "classic"
training in 2023, an increase of +21% compared to 2022.
• In France, the 2023 skills development plan focused on
several key areas, including:• Reinforcing workplace first-aid teams• Implementing a plan to raise awareness and train managers in absenteeism• Securing the critical skills needed for the 1,581 "essential products" production operations carried out by the
Lure plant• Providing tailored support in management, sales, negotiation, and digital marketing through expert consultants.
In the second half of the year, France distributed its first"Digital Learning" modules on Campus by Vetoquinol tomanagers. These modules enable managers to train,exchange and react collaboratively to the content onoffer. In 2023, the reduction in training hours is due tothe implementation of more targeted training initiatives,
the launch of digital training programs, and the mobilization of employees on major projects.
• In the rest of Europe, the number of training hours hasremained relatively consistent compared to 2022.
• In the United States, training hours increased, particularly in Brazil.
• In Asia-Pacific, training hours are increasing to keep
pace with the growth and rotation of the sales force, particularly in India, in order to support the new employees
recruited in 2023.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Vetoquinol's people

As part of our ERP overhaul project, we began implementing training plans for project team members in 2022.
In 2023, these training plans were rolled out to users in
10 different countries.
The Group's human resources department places a highpriority on developing employee skills, and a significant

2.7.7

budget is allocated to employee training. Nevertheless,
we remain committed to identifying and implementing
training and development solutions that offer a superior
quality, time, and cost ratio (including digital training andin-house training)..

Non-discrimination and Equal opportunities

Vetoquinol does not discriminate in the recruitment,
remuneration, or promotion of its employees.
The Group's subsidiaries, often located in remote areas,
face ongoing challenges in attracting talent whose
spouses may encounter difficulties in finding employment. Pharmaceutical production and control operations,which are conducted in a clean and delicate environment,
tend to attract female staff.
In France, the information presented in the comparative
situation report, presented to the Social and Economic
Committee (Comité Social et Économique - CSE) every
year, indicates that the processes applied within thecompany do not generate inequalities per se. The imbalance in the situation of men and women is primarily areflection of the socio-cultural context (for example,
fewer women applying for certain positions) and of thecompany's history.
In terms of compensation, there are no inherent disparities between men and women occupying identical roles
and with comparable tenure. In certain business sectors,
there is a notable underrepresentation of women in positions of greater responsibility. A few isolated instancesof salary discrepancies, resulting from individual career
paths and affecting women and men equally, will likely
necessitate corrective action as part of the year's salarypolicy.

2.7.7.1	Integration of people
with disabilities
Vetoquinol is committed to employing disabled workers
to the fullest extent possible. We maintain disabled
employees in their roles and seek subcontracting
partnerships with ESATs in France whenever feasible.
In 2022, Vetoquinol SA met 65% of the targets set by law
in terms of disability, with an employment rate equal to3.90% (figure published in 2023 for the year 2022).
Vetoquinol SA has been dedicated to a disability policy
for several years. The company sought to identify its
strengths and areas for improvement in implementing
this policy. In 2023, a disability awareness campaign
was launched with the assistance of a specialist consultancy firm. General information meetings were held for
employees based in France, followed by individual interviews.
Some levels of disability (intermediate) entitle employees
to additional days off.

For 2023, the Professional Equality Index for VetoquinolSA, the French entity with 753 employees across allfunctions, was 91/100 (2022: 92/100), well above theminimum set by French regulations at 75% (a composite
index whose calculation method is precisely defined by
French regulations).
The gender balance is maintained at a relatively stableratio year on year (see age pyramid).

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 51

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Environmental footprint

2.7.8

Working hours

Vetoquinol adheres to all legal and contractual obligations regarding working hours in each of its subsidiaries.
The organization of working hours within the Group varies
according to the local context of each subsidiary andbusiness activity.
Part-time work represents 2% of the Group's employees.
This percentage represents a slight increase compared to2022 (1.9%).

Contract type

EuropeThe decision to transition to part-time work is primarily at
the discretion of the employee.
The Group's policy is to hire on permanent contracts. The
proportion of the total workforce on fixed-term contracts
is very small.
As a result of the completion of certain projects, including
the renovation of our Injectables workshop in Lure andthe overhaul of our ERP system, the number of fixed-term
contracts was reduced in 2023.
AmericasAsia-Pacific

Total

Fixed-term

2.3%

0.7%

1.6%

1.7%

Permanent

97.7%

99.3%

98.4%

98.3%

TOTAL HEADCOUNT

100.0%

100.0%

100.0%

100.0%

2.8 ENVIRONMENTAL FOOTPRINTThe Group presents its environmental footprint for its fourmost significant direct environmental aspects: waste,drinking water consumption, energy consumption (gasand liquid), and carbon emissions.
The sites and activities that contribute most are includedin the calculations for the indicators. All industrial and2.8.1

R&D sites are included in the analysis for the four environmental aspects. The main sales entities, with a sales
force of at least 20 employees, are included in the calculations for liquid energy consumption (fuel) and carbon
footprint (scopes 1 and 2). Vetoquinol has elected to calculate its scope 3 for France based on 2022 data.

Pollution prevention

Vetoquinol's industrial sites do not directly emit any
atmospheric gases or particles. The only emissions
from these sites are the combustion products from thecompany's gas-fired boilers. All air emissions from manufacturing workshops that could potentially produce dust
are filtered.

52 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

There are no discharges that could affect the soil, and allindustrial sites operate on sealed floors to contain any
accidental spills. Outside storage facilities are placed inretention basins.
With regard to water discharges, the Canadian and Polishsites have a wastewater network connected to their city's
wastewater treatment plant. The Brazilian site has nowastewater discharges into the public network (apartfrom sanitary water). All wastewater from manufacturing
processes is collected and disposed of as waste by aspecialized company.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Environmental footprint

In Magny-Vernois, effluent from the production facilities
is treated through an in-house biological treatment plant,
which is used to remove biodegradable pollutants. This iscomplemented by a perozonation plant (combining ozone
and hydrogen peroxide treatment) to remove non-biodegradable molecules. The site's wastewater treatment
process is innovative for the French pharmaceuticalindustry and has received an innovation grant from the
French Water Agency.

2.8.2

Vetoquinol takes pride in promptly addressing any
concerns raised by local residents. In the event of aone-off issue, such as during a construction or roadworks
project, residents are informed and appropriate measures
are taken to mitigate the impact.
In fiscal 2023, Vetoquinol did not pay any compensationin execution of a court ruling on environmental matters.
No provisions or guarantees for environmental risks wererecorded.

Waste management

With regard to waste, comprehensive monitoring is
conducted using indicators, and trends are analyzed toprevent any drift. Sorting at source involves the separation of materials such as wood, cardboard, paper, metals,
and electrical and electronic equipment for recycling.
Pharmaceuticals that cannot be recycled are incinerated
in an approved center for energy recovery.
With regard to circular economy issues, Vetoquinol monitors the recycling and/or material recovery rate of waste
generated by the Group's industrial sites. The overall recycling rate for 2023 reached 34%, a slight decrease fromthe 35% recorded in 2022 and the 40% achieved in 2021.
The optimal solution for waste is reuse, and Vetoquinol
prioritizes this approach, which is already in place forpallets, transport containers, printing paper, and othermaterials. The rate of recycling or material recovery of
waste generated by the Group's industrial sites is an indicator monitored each year (see above).
This decline in production can be attributed to the highlevel of quality required for production batches, as wellas the rejection of those that do not meet the expected
standards.
Please note that incineration with energy recovery is notincluded in this estimate. In terms of volume, the amountof industrial waste generated in 2023 is lower than in
2022. However, the recycling rate for non-hazardous
waste improved, reaching 64% in 2023, up from 61% in
2022.
Vetoquinol's objectives are to reduce waste at source
and increase the recovery rate by stepping up selective
sorting on its sites and seeking new external recovery or
recycling channels.
Selective sorting procedures have been implemented at
production sites. Examples include:• Actions to reduce plastic waste, with the introductionof a sorting system for non-food plastic waste at the
Magny-Vernois site, and the elimination of plastic cups
at all sites in France, Poland, and Canada.
• Waste mapping in Princeville.
• Improved waste collection and sorting systems in theoffices of most sites and business units.
• Awareness-raising and communication actions carriedout at all sites and business units.
As a company focused on the development, manufacturing, and marketing of veterinary medicines, Vetoquinol
does not directly address the issues of food waste, responsible, fair, and sustainable nutrition, or food insecurity.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 53

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Environmental footprint

2.8.2.1	Non-hazardous (NHIW) and hazardous (HIW) industrial waste by country(in tonnes)
2022

2021

735

2023

558
473

502
436

428
293

337

DND

393

374
254

DD
France464

46 46 53

24 24 43

DND

DD

79 70 67

33 26 38

32 13 24

DD

DND

DND

CanadaPoland

78

41 58
DD

Brazil2.8.2.2 Overall recycling rate in 2023

34%

66%

Recycling

Landfill &incineration

2.8.2.3 Non-hazardous waste recycling rate

62%

61%

2021

2022

54 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

64%

2023

DD

DND
Total

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Environmental footprint

2.8.3

Sustainable use of resources: water and energy

Water

EnergyWater consumption represents a significant challenge for
Vetoquinol's production sites, given the need to manufacture oral and injectable medicines. In light of thepharmaceutical industry's evolving constraints, there isa growing demand for increasingly efficient and reproducible cleaning processes. These cleaning operations
are typically conducted using water to which detergents
have been added, followed by successive rinses withincreasingly pure water. The majority of these operations
are automated, with programs designed and improved
to optimize water use. Meters and sub-meters are installed at strategic locations to enable the monitoring andcontrol of water consumption. The data collected fromthese devices is analysed to identify any potential issues
and to inform the prioritisation of areas for improvement.

Energy is another significant challenge for production
sites. The Magny-Vernois site received ISO 50001 certification for its energy management system in 2016and has successfully renewed its certification in 2022.
The first surveillance audit was conducted in 2023 aspart of the ISO 50001 certification follow-up process. A
consumption diagnosis and an action plan have been
implemented to reduce energy consumption. The plan isa multi-year initiative that includes investments in more
efficient equipment, metering or regulation systems tobetter manage consumption and monitor discrepancies.
It also includes operations to raise staff awareness,whether in terms of their daily actions at work or theirconsumption at home. Following the same model as
the process for reporting safety risk situations, all staff
at sites in France are now required to report instances ofhigh energy consumption. This may relate to behavioral,organizational, and/or technical aspects. This process
is aligned with the annual ISO plan and helps to enhance
staff engagement with a strategic environmental issue.

The overall consumption of drinking water at industrial
and R&D sites in 2023 was 7% lower than in 2022. This isdue in part to the work carried out on the water loop at the
Magny-Vernois site, and in part to the awareness-raisingand communication campaigns carried out at the sites.
The decrease can also be attributed to lower manufacturing volumes in the second half of the year.
In 2024, our primary focus will be on studying the feasibility of closed-circuiting our process cooling loop.

The Group currently monitors energy performance basedon gas, liquid energy, and electricity consumption. Gas
and electricity consumption remained constant in 2023
compared with 2022. Each Group site (industrial andnon-industrial) is implementing an action plan to reduceenergy consumption through technical improvements
and the development of eco-responsible behavior. In
2023, several noteworthy actions were carried out, including lighting replacement campaigns at several industrialsites, the installation of a heat pump at the Tarare site todisconnect the old, more energy-intensive system, andthe insulation of buildings.
The consumption of liquid energy (fuel) remained
consistent compared to 2022.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 55

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Environmental footprint

2.8.3.1 Drinking water consumption (m3)
75,92369,71642,26745,17564,96242,477

17,296
6,834

France

6,111

2022

12,428
6,143

6,111

Canada2021

13,398

4,492

3,946

BrazilPoland

Total

2023

2.8.3.2 Power consumption (MWh)
2021

2022

20,0402023

18,435 18,556

11,406

10,843 10,556

3,925 3,853

3,935
2,242 2,265

FranceCanada2,087

Poland56 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

1,429

1,217

Brazil

1,192

253

257

USA

786

Total

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Environmental footprint

2.8.3.3 Gas energy consumption (MWh)2021

10,7412022

17,5092023

17,509 17,621

10,209 10,379

3,281 3,030

2,957

4,154

4,134

3,838

28

FranceCanadaPoland23

Brazil

27

121

112

USA

420

Total

2.8.3.4 Liquid energy consumption - fuels (liters)

1,416,816
1,082,846

2022

2023

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 57

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Environmental footprint

2.8.4

Environmental protection

2.8.4.1 Carbon emissions
Given its activity and energy sources, Vetoquinol does nothave a significant impact on GHG emissions in relation to
its added value. The use of natural gas for its production
sites, and electricity with low greenhouse gas emissions
in France (mainly nuclear) and Canada (mainly hydraulic),
contribute to a low energy-related carbon footprint.
Vetoquinol is committed to pursuing further reductions in
its carbon footprint. To achieve this, it is essential to calculate our carbon footprint, which serves as a central tool
for measuring our impact.
The assessment of greenhouse gas emissions refers to
the carbon footprint.
Vetoquinol has been measuring its scope 1 & 2 emissions
since 2017. Since 2020, the scope of calculation has been
greatly expanded to include all industrial and R&D sites aswell as the Group's main sales entities.
The graph below illustrates the emissions expressed in
CO2 equivalent units.
Scope 1 encompasses direct emissions resulting fromfuel consumption and any emissions of refrigerant gases
at our facilities.
Scope 2 corresponds to indirect emissions linked
to electricity consumption, calculated according tocountry-specific emission factors or local supplier factors(as in the case of Canada with Hydro-Québec).

In 2023, greenhouse gas emissions for scopes 1 and 2
totaled approximately 9,585 tonnes of CO2 equivalent,
representing a significant reduction of around 7.7%
compared with 2021, when they are estimated to be
10,262 tonnes on an equivalent basis. This reduction is
the result of the various environmental initiatives that theGroup has undertaken over the last few years.
Vetoquinol has set a target to reduce CO2 emissions per
million euros of sales.
Vetoquinol is dedicated to controlling its carbon emissions in the short, medium, and long term. As previously
stated, each Group entity, whether industrial or non-industrial, is committed to implementing an action plan
designed to reduce its energy consumption and, consequently, its greenhouse gas emissions. The Group HSE
department monitors the progress of this plan on a quarterly basis and reviews it with the Leadership Committee
as part of the monitoring of strategic plan indicators.
The ISO 50001 energy management system in place at
the Lure site, the Group's primary source of emissions, iscontinuously reducing greenhouse gas emissions.
With regard to other atmospheric emissions (volatileorganic compounds, dust), the implementation of appropriate control systems at all industrial sites effectively
controls pollution risks. Atmospheric emissions arecontrolled by filtration systems.

2.8.4.1.1 Emissions in tonnes of CO2 equivalent
9,914

9,585

2,628

2,319

7,286

7,266

2022

2023
Scope 158 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Scope 2

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Environmental footprint

2.8.4.2 Scope 3 calculation
In 2023, Vetoquinol took the initiative to calculate its
scope 3 emissions.
Scope 3 includes indirect emissions linked mainly to
upstream and downstream logistics flows, subcontracted
manufacturing, and waste processing.
In order to gain an initial understanding of our carbon
footprint, including our scope 3 emissions, we defined theperimeter based on 2022 data. This included VetoquinolSA, the parent company in France and the Group's largest
subsidiary, which has several industrial sites, R&D facilities and Group headquarters.
We were assisted in our approach by an external consultancy to ensure compliance with the ADEME carbon
footprint calculation method.
The following steps were taken in the process:• Formation of a pilot team and flow mapping.
• Data collection.
• Consistency analysis.
• Data processing.
• Calculation of GHG emissions.
Once the initial results were presented to the project team,
it was determined that three emissions items accounted
for approximately 90% of our scope 3 emissions. We
therefore established collaborative workshops with theobjective of engaging departments in the carbon footprint reduction project and identifying action levers thatwould enable us to define a "carbon reduction trajectory."
The following three workshops were therefore organizedaround the following themes:• Purchasing and property workshop.
• Travel workshop.
• Freight workshop.

The first two workshops were held at the end of January2024 with the relevant teams. These workshops brought
together over 30 people from different departments overa whole day, and identified concrete action plans for
implementation.
The final "freight" workshop will be held by the end of thefirst quarter of 2024 to complete this work.
We are currently defining our carbon trajectory, which will
enable us to set CO2 emission reduction targets and draw
up action plans to reduce our carbon footprint.
The results of the scope 1, 2 and 3 carbon footprint are
shown in the graph below, with a calculation uncertainty
of between 20 and 25%, which is within the standards ofthe methodology:

1%

Waste

0.4%

Non-energy

6%

Travel6%

Energy7%

66%

Purchases

Freight

14%

Fixed assets

As this is the inaugural year for assessing Scope 3 emissions, Vetoquinol has chosen not to provide raw data,
which only cover the scope of Vetoquinol SA.
It should be noted that the deployment of a complete
carbon footprint (scope 1, 2 and 3) with the support ofindependent experts has confirmed the calculations
relating to scope 1 and 2 emissions carried out by thecompany using an internally-developed methodology.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 59

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Our products

2.8.5

Protection of biodiversity

The Group's activities do not involve manufacturing processes that result in the significant depletion of scarceor non-renewable resources, natural resources, or biodiversity. Vetoquinol is mindful of its environmental impact
and takes measures to minimize it on a daily basis.

its upkeep, thus preserving the diversity of living naturalorganisms. Furthermore, a total of approximately one
hectare of flowery fallow land was planted in 2023, withthe objective of preserving biodiversity. This will benefit
birds, insects, and other organisms.

All new construction projects undergo a landscape study
to ensure the preservation of the ecosystem. At the Luresite, Vetoquinol has chosen to preserve a lake and ensure

The Lure site kept its forest management contract in
2023, ensuring the sustainable development of theresources surrounding the site.

2.9 OUR PRODUCTS
2.9.1

R&D process overview

The process of bringing a molecule (chemical or biotechnological) or compound to regulatory approval can takeup to ten years. It is classically segmented into four distinct stages:
1/ Research: The primary objective of this phase is to
identify new biological targets involved in pathologicalprocesses. Once the targets have been identified andcharacterized, a large number of potential candidate
molecules are tested on them (the screening stage) andtheir pharmacological activity is measured.
The Group is currently making limited investments anddeveloping a network of contacts with academic andindustrial partners in order to evaluate promising candidate molecules and, where appropriate, sign licensing
agreements. The Group has developed considerable
expertise in developing relevant screening programs andinnovative galenic forms that provide a competitive edge,
including factors such as tolerance and mode of administration. This initial stage serves to demonstrate thesuitability of the candidate molecule(s) for the targeted
pathology, thereby establishing a proof of concept.

60 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

2/ Preclinical and clinical development:• Demonstrating efficacy and safety under preclinicalconditions. The objective of this stage is to evaluate thecandidate molecule in a controlled environment and toestablish a preliminary pharmacokinetic (absorption,
distribution, metabolism, elimination) and pharmacodynamic profile in the target animal species. These
results confirm the suitability of the candidate molecule
for the targeted pathology and demonstrate the safetymargin of the future drug, i.e., the product's tolerability.
Finally, this stage enables us to determine and confirm
the dosage regimen, i.e., the optimal treatment regime
to ensure maximum efficacy and minimal side effects.
In the field of animal health, this type of preclinicalstudy corresponds to phases I and II of human drug
development.
• Clinical trials. These trials, conducted on sick animals,
represent the final stage of studies conducted before amarketing authorization application is filed. They correspond to phase III of human drug development. The
objective of these trials is to confirm data from preclinical studies and verify the efficacy and safety of the
drug under future conditions of use. These trials involvea larger number of animals (approximately 200 to 300)
than in the preclinical phase.
• Safety studies also aim to guarantee the safety of theveterinary practitioner or owner who will administer the
product, as they are in contact with the drug.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Our products• It is a legal requirement that residue studies are carriedout for drugs intended for farm animals (cattle, pigs
and poultry), whose products (meat, milk and eggs) areconsumed by humans. This is to guarantee consumer
safety. The objective of these studies is to determine
the minimum waiting period between the conclusion oftreatment and the slaughter of the animal (in the caseof meat) or the marketing of its products (in the case of
milk and eggs). It is important to note that the animal or
its products cannot enter the agri-food chain during thiswaiting period.
•In the case of drugs for farm animals, studies are
conducted to demonstrate the harmlessness of drug
residues released by the animal (feces, urine, etc.) forthe environment. These studies, known as ecotoxicology, assess the impact of drug residues on soil, fauna,and flora.
3/ Development of the manufacturing process for the
prototype developed and selected above. The objective

2.9.2

of this stage is to develop a robust, reproducible manufacturing process leading to a suitable formulation of the
drug candidate and to fine-tune all the processes required
for the industrialization of the future product. During thisphase, the analytical methods used to test the product's
stability and the consistency of its subsequent quality
throughout its life cycle are also developed. The data isused to define the product's expiration date.
4/ In order to market a veterinary medicinal product, it isnecessary to obtain a marketing authorisation (MA). Oncesubmitted to the EMA or to the relevant country authority,
the marketing authorisation submission, which brings
together all the information obtained during development,
undergoes a scientific evaluation by the supervisory
authorities (health and/or agriculture). The aim of thisevaluation is to verify the quality, safety for the target
animal, the user, the consumer and the environment, as
well as the efficacy of the veterinary medicinal productitself.

Vetoquinol Group R&D strategy

The Group's R&D activity has two main objectives:• growth in sales and profitability (i) by bringing to market
innovative, high-quality products that meet unmet
needs, such as improved efficacy and safety, and easeof administration, compared with products already on
the market, (ii) by defending all the Group's relevant marketed products,• enhancing the Group's reputation and scientific expertisethrough publications in recognized scientific journals,
presentations at scientific events, patent filings and theestablishment of a network of scientific experts.

2.9.2.1 Resolute strategic focus
R&D plays a pivotal role in the selection of robust therapeutic areas and target species through comprehensive
analysis. This allows R&D resources to be allocated in
the most appropriate and optimal way to its portfolio of
projects, while simultaneously strengthening its scientificknowledge in these fields.
R&D conducts research programs aimed at therapeuticand galenic innovation, as well as product development
programs focused primarily on the Group's areas ofexpertise: dermatology, mobility, parasitology and dairy
farming.

However, the Group remains true to its history, not hesitating to explore new opportunities in other attractive
disease areas where its technological expertise and marketing skills can make a difference.
The diverse skill sets of these businesses enable theGroup to register innovative products based on new chemical entities and molecules derived from biotechnology,
improvements to existing galenics or packaging, or thedevelopment of generics. The Group places particularemphasis on the life-cycle management of its marketed
products. This involves the development of new formulations, packaging, dosage and administration routes,
extensions of indications or species, and registration in
new geographical areas.
These programs are further enhanced by an active policyof partnerships with government bodies (INRAE, veterinary schools, foreign universities, etc.) and the private
sector. These partnerships are focused on research anddevelopment, including the development of new formulations and the application of innovative drug delivery
technologies.

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Our products

2.9.3

Organization of Vetoquinol's scientific division

The Group's R&D organization is structured to develop
new products and is continuously optimized through aprocess of continuous improvement. The organization

In millions of euros

currently employs approximately 180 individuals, including approximately 60 scientific managers.
The Group allocated 7.6% of its sales to R&D activities,
equating to €40.1 million in 2023.
2023

2022

2021

R&D expenditure

40.1

32.6

31.0

% of sales

7.6%

6.0%

5.9%

The company's research and development (R&D) operations are primarily based in France, with the center ofexpertise and scientific excellence located at the company's headquarters in Lure. Additionally, the company
has a research center in Angers. The objective of R&D
is to develop products for worldwide registration. Vetoquinol's R&D is further enhanced by product development
units in key global markets, including the USA and Brazil.
These units work in close collaboration with the main
R&D center in France, contributing to the development
and support of our local products.
These teams have enabled us to register dossiers in
Europe, America, and Asia, demonstrating the world-classskills maintained by a network of experts. These experts
include pharmacologists, toxicologists, and pharmacokineticists; pathologists and clinicians; and scientificleaders in key strategic areas. The Group has gained thetrust of this network of experts thanks to its commitment
to ethical conduct and scientific credibility.
Another key objective is to foster strategic alliances toensure the most effective deployment of our innovative
offering in the Group's strategic areas.

62 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Vetoquinol's reputation is enhanced by a policy of
publishing and presenting at international scientificconferences.
Given the highly regulated environment in which veterinary drugs are developed, the Group's R&D department
has chosen to integrate regulatory affairs skills directly into its teams. This allows them to participate in theentire process, from conception to development, with adual objective: to advise on development strategy and tointegrate data with a view to compiling the registration
dossier.
The responsiveness of exchanges between scientists isensured by three departments across the board:• Quality Assurance audits and actively contributes to thecontinuous improvement of development processes,
thus guaranteeing the required level of good practice inaccordance with GLP, GCP, and GMP standards.
• Pharmacovigilance monitors the safe use of products byour customers.
• The Projects Department coordinates the various
players involved in research and development, andconsolidates all projects across the portfolio to ensure
the proper allocation of human and financial resources.

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Our products

2.9.4

Overview of current R&D programs

In light of the evolution of the animal health market andthe increasing medicalization of pets, R&D priorities haveundergone a change. The Group, which was originally acompany focused almost exclusively on farm animals,
is now directing a significant part of its research effort
towards pets. It is also engaged in the developmentof innovative production, formulation, and packaging
technologies.
The Group's R&D efforts are focused on the developmentof breakthrough innovations, as well as incremental innovations and the evolution of existing products.

2.9.5	Dependence on human health research
for the development of new molecules
In the field of animal health, innovation occurs in specificareas, including vaccines, reproductive management (productivity), and areas common to human health (antibiotic
therapy, pain and inflammation management, cardiology,
oncology, etc.) or plant protection (anti-parasitics).
These therapeutic areas present an opportunity foranimal health companies backed by a human or plant
health group, offering potential access to a wider rangeof molecules.
For Vetoquinol, this is not a limiting factor for its innovation, as the company has identified several reasons why
this is not the case.
• In the field of animal health, there are numerous molecules used in human health whose patents have fallen
into the public domain. This presents a significant
opportunity for innovation.

• In fields where research is very active in human health(cardiology, pain, cancer), many "biotech" companies areready to license their technology and/or their molecules
in animal health. This allows them to contribute to thefinancing of the early phases of development in humanhealth.
• Medium-sized human health companies, which do nothave an animal health department, appreciate finding
pure animal health players to whom they can entrust
their molecules. This allows them to focus on their corecompetencies. This is an intriguing and beneficial addition for these companies. The animal health sector has
a distinct growth profile compared to human health,which presents an opportunity for innovation.
• Another avenue for growth is drug repositioning, which
involves reorienting existing molecules and developing
them for new therapeutic indications.

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2.9.6	Antibiotics for veterinary use and antibiotic resistance:
a commitment to the rational use of antibiotics inanimal health
The discovery of antibiotics represented a significant
advancement in the field of medicine during the 20th
century, and they continue to be an essential component of the therapeutic toolkit for both doctors andveterinarians. To date, there is no alternative treatment
for bacterial infections. However, the extensive andsometimes excessive use of antibiotics has altered
the bacterial ecosystem, exerted selection pressure for
reduced sensitivity, and contributed to the emergence ofbacterial resistance to certain antibiotics.
The fight against the development of bacterial resistance and the preservation of antimicrobial activity havebecome global public health issues, and Vetoquinol isfully involved in managing the problem as a responsible
player. Most European countries have already introduced
national plans and set targets for reducing the use ofantibiotics in veterinary medicine. The use of so-called
critical antibiotics—those particularly prone to resistance,or antibiotics of last resort such as fluoroquinolones andgeneration 3 and 4 cephalosporins—is now subject torestrictive regulations that have reduced their use. The
regulations have had a gradual and ongoing impact on
the Group's business in Europe, resulting in a decline in
the proportion of sales generated by anti-infective products.
Vetoquinol is dedicated to combating the developmentof antibiotic resistance. We do not market antibiotics for

2.9.7

growth promotion purposes and prohibit this practice.
Vetoquinol is also strongly committed to supporting veterinarians in the prescription and proper use of antibiotics.
Over the past decade, we have been providing dosage
regimens that comply with recommendations in the fightagainst antibiotic resistance (SISAAB concept), organizing scientific and legislative webinars led by experts, andproviding awareness-raising tools for owners.
Vetoquinol has been a pioneer in Europe for over 20 years,
conducting epidemiological surveillance of the susceptibility of bacteria responsible for various pathologies
in livestock and pets to the antibiotics it markets. This
ensures that treatments do not lead to reduced susceptibility or antibiotic resistance, even when used correctly.
Vetoquinol, a company with extensive experience andexpertise in the field of anti-infectives, is committed tomaintaining its position as a leading provider of curative
and targeted treatments for animal health. This commitment is driven by the company's dedication to the rationaluse of anti-infective drugs. Vetoquinol has initiated andis actively pursuing research programs to identify alternatives to antibiotics.
Finally, Vetoquinol develops and markets rapid diagnostic
tools to enable the rational use of the antibiotic arsenal
still available to veterinary medicine.

Eco-friendly products

In line with its commitment to sustainable development,
Vetoquinol is working to integrate environmental criteria into the development of new products and solutions.
Specifically, this entails considering the environmental
impact of raw materials and manufacturing processes
at an earlier stage, as well as developing products thatare inherently more "eco-responsible." In this context, the"Ecopack" project was initiated in 2019. The objective of
this project is to reduce the environmental footprint linked

64 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportto the packaging of our products. This will be achieved by
implementing measures such as:• Densification of palletization plans.
• Kraft cushioning solutions to replace plastic bubblewrap.
•Use of kraft cardboard on secondary packaging to
reduce weight.

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Social footprint

2.10 SOCIAL FOOTPRINT

2.10.1	Territorial, economic and social impact of the group’sbusiness
Vetoquinol is a significant contributor to the local
economy, both in terms of the economic activity it generates and the jobs it maintains around its industrial sites.
The Group's entities are generally located outside major
metropolitan areas, where they contribute to local andregional development through their presence and growth,
creating employment opportunities.
In France, Vetoquinol plays a role in the training of approximately forty apprentices each year.
Furthermore, the Group has a robust support culture, withnumerous entities welcoming students on a regular basis
to train the employees of tomorrow.
Vetoquinol plays an active role in local communities byparticipating in and supporting various social, environmental, and humanitarian initiatives.
Vetoquinol sponsors cultural events and sporting events,
as well as clubs.
Vetoquinol is committed to maintaining positive relationships with local residents and ensuring that its
facilities blend harmoniously with the surrounding environment.
The company's activities, including those at its industrialsites, have a minimal impact on local residents in termsof noise, visual pollution, and environmental impact.

2.10.1.1 C ommunity initiatives
conducted by Vetoquinol and its
subsidiaries in 2023
Cultural support
For many years in France, Vetoquinol has been associatedwith the Musique et Mémoire festival, a key event on the
French Baroque scene in the Vosges Saônoises region
and a member of the European early music network.
Over the years, the festival has maintained a workshop
spirit, where music is performed on a human scale, in a
privileged relationship between artists, festival team andaudience.
Vetoquinol also continued its sponsorship of the UNESCOWorld Heritage Site, the Chapelle de Ronchamp, designed
by architect Le Corbusier over 60 years ago. Vetoquinol isa founding partner of the club of patrons who support andaccompany the development and influence of this uniquesite in the world.

Charitable support
In France, employees participated in the Pink Octobercampaign in support of the League against Breast Cancer,
and Vetoquinol matched the amount raised.
Vetoquinol has been a patron of the Vetericare Association for the past four years. The association, foundedby veterinarians, helps pet owners by covering the costof care when they are unable to afford it. In the absenceof adequate financing solutions, owners are sometimes
forced to consider euthanizing their pets. This untenablesituation inevitably gives rise to feelings of anger, injustice, and incomprehension, not only among owners, butalso among care teams, who are powerless to deal withthese situations, which run counter to their vocation ofcare. This year, Vetoquinol organized the "Vetoquinol
Walks for Vetericare" challenge with the goal of walking
10 million steps to raise €10,000 for the Vetericare
association. This objective was achieved thanks to theenthusiastic participation of our employees.
In Canada, Vetoquinol continued its long-standing
commitment to the Centraide Foundation for the 14th
consecutive year. The foundation's mission is to improve
the quality of life of the most vulnerable and to unite thecommunity by encouraging citizens to take action. It
helps more than 60,000 people.

2.10.1.2 Nation - Army link
Vetoquinol is in communication with the French Ministryof the Armed Forces with the objective of establishing anagreement to support the military reserve policy. This willentail granting special facilities to Vetoquinol employees
who are operational reservists, enabling them to carry out
their periods of reservist activity. Secondly, the agreement
will aim to establish a climate of trust between Vetoquinol
and the Ministry of the Armed Forces based on dialogue.
Vetoquinol is committed to implementing this agreement
during 2024.

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Social footprint

2.10.2 Animal welfare
Vetoquinol has defined its mission as follows: "Enrichingpeople's lives through dedication to animal health andwelfare."The company's products, services, solutions, practices,
and activities are designed to improve the health andwelfare of animals, thereby enhancing the lives of people.
The term "animal welfare" is defined as "the quality oflife as experienced by an individual animal." To assess
an animal's level of welfare, it is necessary to combine
knowledge, experience, empathy, and sensitivity. The five
fundamental freedoms describe society's expectations
regarding the living conditions of animals when they are
under human care. These principles have been incorporated into the World Organization for Animal Health's(WOAH) definition of animal welfare, which serves as theindustry standard. These principles form the foundationof the majority of international, European, and French
regulatory policies:
1. Absence of hunger, thirst, and malnutrition.
2. Absence of fear and distress.
3. Absence of physical or thermal stress.
4. Absence of pain, lesions, and disease.
5. 
The animal is able to exhibit the typical behaviors
expected of its species.
In France, the ANSES (Agence nationale de sécurité sanitaire de l'alimentation, de l'environnement et du travail)has also defined animal welfare as "the positive mental
and physical state linked to the satisfaction of the animal's physiological and behavioral needs, as well as its
expectations."
The following actions have been implemented:
1. Vetoquinol designs, manufactures, and markets products, services, and solutions to improve the comfort
and health—in other words, the welfare—of animals.
This is our primary objective.
2. Vetoquinol's animal welfare initiatives contribute to thewelfare of people in various roles, including veterinarians, breeders, and private pet owners.
3. All Vetoquinol employees in charge of animals adhere
to the ethical principle of the 3Rs (replace, reduce,
refine) and act in accordance with the "5 Freedoms" infavor of animal welfare.

66 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

This "3Rs" rule forms the basis of European regulations
on preclinical studies:• Replace animals wherever possible with cells or tissues(in vitro) or digital models (alternative preclinicalmethods).
• Reduce the number of animals used by limiting experiments to those that are absolutely essential, avoiding
unnecessary repetition of previous studies, and drafting an experimental protocol that often makes further
animal testing unnecessary.
• Refine, i.e. reduce, eliminate or alleviate the pain or
distress experienced by the animals, and improve theirwell-being by controlling the conditions under which they
are transported, reared and housed, and by establishingcriteria for stopping the procedure early if necessary.
4. Limiting the use of natural resources, saving energy,
and reducing waste: Vetoquinol is proud to be one of thefirst companies in France to have equipped its wastewater treatment plant in Lure with the latest technology to
reduce the drug content of the water it discharges into thenatural environment by 99%.
At Vetoquinol, we are dedicated to ensuring the welfare ofanimals and humans now and in the future.

One Health
The "One Health" initiative is based on the conviction thatthe health of animals, humans, and our shared environment are inextricably linked.
The protection of animal health is an essential component of the broader effort to safeguard human health.
The presence of unhealthy animals can present a risk tohuman health and the surrounding environment. Consequently, the spread of zoonoses is becoming increasingly
problematic. Zoonoses have been a contributing factor
in the spread of human disease epidemics. Vetoquinol's
commitment to animal welfare helps to limit the spreadof zoonoses and promote a health context conducive tosustainable development.

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2.10.3 Humans and animals: a lifelong relationship2.10.3.1 Dogs: humans’ best friend
The positive effects of pet ownership on human physicaland mental well-being are well-documented. The status ofanimals has evolved throughout history. Initially domesticated for utilitarian purposes, today's pets have become
inseparable companions to their masters. Pets excel in
their social role, becoming an integral part of the family
and sharing daily life in the home. It is not uncommon foranimals to provide assistance, moral support, and relief
to humans.
Vetoquinol offers a website, www.myhappypet.fr, which
is dedicated to pet owners and is available in 12 othercountries. The My Happy Pet website provides practicaladvice, tips, and other useful information for pet owners.
Pet owners can also find advice on pet health and welfare
on social networks such as Facebook and Instagram at"My Happy Pet Worldwide."
The topics covered range from the everyday care of theanimal to more specific issues for which owners require
expert guidance. These digital resources are designed toprovide guidance to pet owners. A 2014 study by the Veterinary Medicine department at Lyon 1 University foundthat 75% of pet owners consult the internet for medical
information, with 90% of them rating their vet as the mostreliable source.
At Vetoquinol, we remain committed to maintaining close
relationships with our customers and partners. This
allows us to better understand their needs and provide
them with the support they require on a daily basis.

2.10.3.2 Animals and children

2.10.3.3 A
 nimals and elderly people living
alone
Pets offer a number of benefits to their owners, including
a sense of reassurance and structure to the day, regular
walks, and the opportunity for social contact. Today, many
institutions for the elderly accept pets, and many peopleview them as a guarantee of quality of life and comfort.
For instance, the Haute Autorité de Santé recommended
in its 2018 report, "La vie sociale des résidents en Ehpad,"that facilities allow animals on the grounds, citing thepotential benefits of having pets, including reducing thesense of being uprooted, providing a reassuring presence,and enhancing residents' quality of life.

2.10.3.4 Animals and the disabled
Guide and assistance dogs enhance the independence
of individuals with disabilities, provide a constant sourceof comfort, warmth, and friendship, and facilitate social
reintegration. Guide dogs assist blind individuals in navigating independently and safely.

2.10.3.5 The animal during lockdown andremote working
The period of lockdown has led to remote working becoming an integral part of modern working practices. The
role and presence of the pet at home and in the workplace have increased dramatically. Pets have become an
integral part of modern life, accompanying us on a daily
basis. This demonstrates the long-lasting impact of the
pet's role and position within the home and family.

Pets play a crucial role in a child's development and socialization. They serve as close companions and confidants,
providing a unique perspective and ability to observe andhear everything.
The presence of a pet can help to alleviate fear, suffering,or anxiety.

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2.10.4 Ethics and fair practices
The Group has established the Partnerships, Legal and
Risks Department, which is responsible for ensuring risk
management, internal control, and the Group's compliancewith industry standards, including ethics, anti-corruption,and the General Data Protection Regulation (GDPR).

2.10.4.1 Code of ethics
Vetoquinol's core values are trust, dare, and collaborate
to Achieve More Together. These values are embraced by
the company's global workforce. These values assume
that there are clear and consistent standards of conduct
within the Group. These common rules, which must apply
to everyone, are set out in the Vetoquinol Code of Ethics.
This Code outlines the commitments, practices, andbehaviors that Vetoquinol has chosen and adopted in its
internal and external relations. All employees are expected to adhere to the standards set forth in this Code at all
times:• Being loyal to the company, its employees, and partners;
always acting with integrity;•R especting the law;•R
 emaining objective in all circumstances;•C arrying Vetoquinol's values;•W hile preserving Vetoquinol's image of integrity.
The Code of Ethics and the Anti-Corruption Code of
Conduct are available on the Vetoquinol website, www.
vetoquinol.com.
Vetoquinol is committed to complying with all applicablelaws and regulations, regardless of the country in which
its activities are carried out.
Vetoquinol strives to maintain business relationships withall partners who adhere to the highest standards of professional ethics.
Vetoquinol is dedicated to upholding the International
Labour Organization's Declaration on Fundamental Principles and Rights at Work in all its entities.
Vetoquinol is dedicated to combating all forms of discrimination.
Vetoquinol is committed to ensuring compliance with allapplicable environmental standards.

2.10.4.2 A nti-corruption complianceprogram
2.10.4.2.1 Anti-corruption code of conduct
Vetoquinol has adopted the MiddleNext Anti-Corruption
Code of Conduct, which refers to the United Nations
Convention against Corruption and is committed to combating all forms of corruption.

68 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

This code of conduct defines the fundamental principles
and rules governing corruption and influence peddling in
the following areas:
The code of conduct covers the following areas:• Rules specific to civil servants•G ifts and invitations• Donations to charitable or political organizations• Patronage, sponsorship•F acilitation payments
 hird-party monitoring•T• Conflicts of interest•A ccounting records and internal controls.
All employees are expected to conduct themselves in an
exemplary manner within Vetoquinol and to refrain fromengaging in any conduct that is contrary to the rules ofconduct set out in this code.
This Code has been supplemented by a policy on gifts
and invitations to ensure that all employees are aware of
the appropriate conduct in this area.

2.10.4.2.2 Whistleblowing system
All employees have access to an internal whistleblowing
system, which allows them to report any situation that
may be contrary to the anti-corruption Code of Conduct
in a secure and confidential manner. The Ethics Committee, comprising the Group Human Resources Director,a Country Director, and the Group Legal and ComplianceExpert, is responsible for processing and investigating
any alerts transmitted under this system.

2.10.4.2.3 Training
In addition to the training courses offered to a numberof its employees, Vetoquinol deploys a "Doing BusinessWithout Corruption" training module among its teams,
available in all the Group's languages.

2.10.4.2.4 Corruption risk mapping
Vetoquinol has identified and mapped these risks in thefollowing countries: The countries in question are France,
the USA, Mexico, Poland, Italy, India, and China.
The Group places a significant emphasis on the integrityof its suppliers. To assess supplier integrity during thequalification and validation process, an anti-corruption
questionnaire has been introduced.

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Social footprint

2.10.4.3 The General Data Protection
Regulation (GDPR)
Vetoquinol is dedicated to safeguarding the privacy of its
employees and partners and has initiated a process ofcompliance with the General Regulation on the Protectionof Personal Data (GPDR).
Vetoquinol has developed a multi-year action plan tostrengthen and harmonize its compliance actions acrossthe Group.
This action plan is led by an international, multi-disciplinary team comprising the Group DPO, a legal advisor on
personal data, and "Local Privacy Champions."
Vetoquinol regularly conducts training and awareness-raising initiatives for its employees in the area of personal
data protection, and develops procedures tailored to thecompany's specific challenges and risks.

2.10.4.4 Prevention of tax evasion
Vetoquinol places a high priority on maintaining
consistent and reliable relationships with its business
partners. To ensure transparency and accountability, thecompany rigorously monitors the accuracy and integrityof the legal and financial information it provides.
Vetoquinol does not engage in any tax planning arrangements that could be considered "aggressive" within themeaning of European Council Directive (EU) 2018/822 of
May 25, 2018 on the automatic and obligatory exchange
of information on cross-border reportable arrangements,
known as "CAD 6."
Furthermore, Vetoquinol does not engage in any tax avoidance schemes prohibited by the "ATAD Directive," asdefined in Council Directive (EU) 2016/1164 of July 12,
2016.

2.10.5 Supplier relations
Vetoquinol is dedicated to maintaining the highest standards of professionalism and ethical conduct in its
interactions with employees, shareholders, customers,
suppliers, and partners. Vetoquinol is committed toacting with integrity, fairness, and objectivity towards its
partners.
In order to achieve this, Vetoquinol has drawn up a Codeof Ethics which forms the basis of the common rules thatmust guide all Group employees in their day-to-day behavior and actions (see 2.10.4.1).
Vetoquinol's relationships with its supplier partners are
guided by the Group's purchasing policies, which apply
to all types of purchases. These include materials andcomponents for production (Direct Purchases), production commodities, services and other services outside
production (Indirect Purchases), as well as subcontracting purchases. These Group policies establish a clear
framework for all employees, defining structured, secure,methodical, professional, and responsible purchasing
practices.

In alignment with this standard, in 2023 Vetoquinol
enhanced the reliability of its expenditure procedures bystreamlining the verification of compliance when placing
orders via other core software. This ensures comprehensive compliance across all transactions.
In 2023, our purchasing teams continued to effectively
combat the upward trend in the markets, which was
mainly due to multiple geopolitical tensions. Prices
were particularly influenced by food-related markets,
while energy and energy derivatives were deflated. The
transport offer was developed with consideration of thefavorable supply situation and disruptions in the Red Sea.
Our ongoing efforts to secure supplies through thedevelopment of dual sourcing, safety stocks, and contractualization of the most important sources will continue
over the long term.
The Group's activities have also been influenced by sustainable development, with a focus on seeking more
respectful practices in the supply and choice of raw materials, particularly packaging.

Vetoquinol continued the approach initiated in 2020 bydeploying the supplier reference framework in an additional subsidiary in 2023. The Group is confident ofcontinuing this deployment in the other subsidiaries after
2024. In addition to meeting several key requirements for
managing relations with the Group's suppliers, this project
establishes robust standard practices for managing
relations between Vetoquinol and its partners. Notably,
it validates certain ethical and anti-corruption aspects
through a questionnaire.

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European green taxonomy

2.11 EUROPEAN GREEN TAXONOMY

Fiscal 2023
Economic
activities (1)Sales (3)Fiscal year 2023
Code (a)(2)

Objective

Currency
(M€)

Share
of
sales,
year N(4)%

A. ACTIVITIES ELIGIBLE FOR TAXONOMY - SALES

of which enabling

Sales of environmentally
sustainable activities(aligned with taxonomy)(A.1.)

0

0

0

0%

0%

0%

Climatechangemitigation(5)

Y; N; N/EL(b) (c)Water(7)

Y; N; N/EL (b)(c)

Pollution(8)

Y; N; N/EL(b) (c)Y; N; N/EL (b)(c)

Circulareconomy(9)

Substantial contribution criteria
Adapting
to climatechange(6)

Y; N; N/EL(b) (c)A.1. Environmentally sustainable activities (aligned with taxonomy)of which transitory

Biodiversity
(10)

529

100%

100%

0%

0%

N/EL

EL; N/EL (f)

0%

0%

N/EL

EL; N/EL (f)

0%

0%

N/EL

EL; N/EL (f)

100%

100%

EL

EL; N/EL (f)

0%

0%

N/EL

EL; N/EL (f)

0%

0%

N/EL

EL; N/EL (f)

Y; N; N/EL(b) (c)Drugmanufacturing

529

100%

A.2 Activities eligible for taxonomy but not environmentally sustainable (not aligned with taxonomy) (g)Sales of activities eligible
for the taxonomy but notenvironmentally sustainable(not aligned with thetaxonomy) (A.2.)

529

PPC 1.2

A. Sales of activities eligible
for taxonomy (A.1. + A.2.)

529

0

100%

0%

B. ACTIVITIES NOT ELIGIBLE FOR THE TAXONOMY
Sales of activities not eligible
for taxonomy
TOTAL (A+B)

Climatechangemitigation(5)

YES/NO

Water
(7)

YES/
NO

Pollution(8)

YES/NO

YES/NO

Circulareconomy(9)

Do No Significant Harm ("DNSH") (h)Adapting
toclimatechange(6)

YES/NO

YES/NO

Biodiversity Minimum(10)
guarantees(17)

YES/NO

Share of sales
taxonomicallyaligned(A.1.) or
taxonomicallyeligible (A.2.),
year N-1 (18)

Enabling
activity
category(19)

T

Transitional
activity
category
(20)

T

H

H

%

0%

70 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportCAPEX(3)

Currency(k€)

Code (a)(2)

Objective

Fiscal year 2023

%

Share
of
CAPEX
in yearN (4)Y; N; N/EL(b) (c)Climatechangemitigation
(5)

0

0

of which enablingof which transitory

0%

0%

0%

Y; N; N/EL(b) (c)Adapting
to climatechange(6)

Y; N; N/EL (b)
(c)

Water
(7)

Y; N; N/EL(b) (c)Pollution(8)

17,642

19,010CAPEX of activities not eligible fortaxonomy

TOTAL (A+B)

B. ACTIVITIES NOT ELIGIBLE FOR THE TAXONOMY

1,368

A. CAPEX of taxonomy-eligible activities(A.1. + A.2.)

838

1,368

CCM 7.3/ CCA
7.3

Installation, maintenanceand repair of energy-efficientequipment

530

CAPEX of activities eligible for thetaxonomy but not environmentally
sustainable (not aligned with thetaxonomy) (A.2.)

CCM 7.2/ CCA
7.2

Renovation of existingbuildings

100%

92.8%

7.2%

7.2%

4.4%

2.8%

0%

100%

EL

EL

EL; N/EL (f)

0%

100%

EL

EL

EL; N/EL (f)

0%

0%

N/EL

N/EL

EL; N/EL (f)

0%

0%

N/EL

N/EL

EL; N/EL (f)

0%

0%

N/EL

N/EL

EL; N/EL (f)

Y; N; N/EL (b)(c)

Circulareconomy(9)

Substantial contribution criteria

A.2 Activities eligible for taxonomy but not environmentally sustainable (not aligned with taxonomy) (g)0

CAPEX of environmentally sustainable
activities (aligned with taxonomy) (A.1.)

A.1. Environmentally sustainable activities (aligned with taxonomy)

A. ACTIVITIES ELIGIBLE FOR TAXONOMY - CAPEX

Economic activities (1)Fiscal 2023

0%

0%

N/EL

N/EL

EL; N/EL (f)

Y; N; N/EL(b) (c)Biodiversity(10)

YES/NO

Climatechangemitigation(5)

YES/NO

Adapting
toclimatechange
(6)

YES/
NO

Water
(7)

YES/NO

Pollution(8)

YES/NO

Circulareconomy(9)

YES/NO

YES/NO

Biodiversity Minimum(10)
guarantees(17)

Criteria for absence of material harm ("DNSH") (h)

0%

0%

%

Share of
CAPEX
aligned withtaxonomy(A.1.) or
eligible fortaxonomy(A.2.), year
N-1 (18)

H

H

Enabling
activity
category
(19)

T

T

Transitional
activity
category(20)

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
European green taxonomy

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 71

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
European green taxonomy

Fiscal 2023
Economic activities (1)OPEX (3)Fiscal year 2023
Code (a)(2)

Objective

Currency(M€)

A. ACTIVITIES ELIGIBLE FOR TAXONOMY - OPEX

Share
of
OPEX
in yearN (4)%OPEX from environmentally sustainable
activities (aligned with taxonomy) (A.1.)

0

0

0

0%

0%

0%

Climatechangemitigation(5)

Y; N; N/EL(b) (c)A.1. Environmentally sustainable activities (aligned with taxonomy)of which transitoryof which enabling

Water
(7)

Y; N; N/EL (b)(c)

Pollution(8)

Y; N; N/EL(b) (c)Biodiversity
(10)

0%

0%

0%

EL; N/EL (f)0%0%EL; N/EL (f)0%0%EL; N/EL (f)0%0%EL; N/EL (f)0%0%EL; N/EL (f)0%0%EL; N/EL (f)

Y; N; N/EL(b) (c)00%Y; N; N/EL (b)(c)

Circulareconomy(9)

Substantial contribution criteria
Adapting
to climatechange(6)

Y; N; N/EL(b) (c)OPEX from activities eligible fortaxonomy but not environmentally
sustainable (not aligned with taxonomy)(A.2.)0

A.2 Activities eligible for taxonomy but not environmentally sustainable (not aligned with taxonomy) (g)A. OPEX of activities eligible fortaxonomy (A.1. + A.2.)

OPEX from activities not eligible fortaxonomy (total Group external expenses)

107.3

107.3

100%

100%

B. ACTIVITIES NOT ELIGIBLE FOR THE TAXONOMYTOTAL (A+B)

Adapting
toclimatechange(6)

YES/NO

Water
(7)

YES/
NO

Pollution(8)

YES/NO

Circulareconomy(9)

YES/NO

YES/NO

YES/NO%

Biodiversity Minimum Share of OPEX
(10)guarantees aligned with(17)
taxonomy(A.1.) or
eligible fortaxonomy(A.2.), year
N-1 (18)

Criteria for absence of material harm ("DNSH") (h)Climatechangemitigation(5)

YES/NO

Enabling
activity
category(19)

T

Transitional
activity
category
(20)

T

H

H

72 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Summary table of non-financial indicators

Share of Capex/Total Capex

Taxonomy by objective

AlignedEligible

CCM – Climate change mitigation

0.00%

7.20%

CCA – Adaptation

0.00%

7.20%

WTR – Water

0.00%

CE – Circular economy

0.00%

PPC – Pollution

0.00%

BIO – Biodiversity

0.00%

2.12	S UMMARY TABLE OF NON-FINANCIAL
INDICATORS
Environment
Wording

Unit

2022

Number of production sites

Number of sites

Production volumes

Number of units manufactured

Number of Marketing Authorizations (MA)

Number of units

Number of R&D centers

Number of centers

2023

5

5

27,000,000

21,000,000

1,000

1,000

5

5

Number of employees dedicated to R&D

Number of employees

211

203

% of sales dedicated to R&D

%

6

7.6

Number of sites with an environmental
management system in place

Number of sites

55

Eligible investments green taxonomy

K€

Total gas energy consumption

KWh

17,50917,621

Total energy consumption oil

liter

1,416,816

1,082,846

Total electricity consumption

MWh18,435

18,556

Total carbon emissions scope 1

Ktonnes of CO2

7,286

7,266

Total carbon emissions scope 2 -Ktonnes of CO2

2,628

2,319

Total water consumption

m3

69,71664,962

Total waste production

Tons

1,022

795

Overall recycling rate

%

35%

34%

Non-hazardous waste recycling rate

%

61%

64%

Hazardous waste production

Tons

464

369

1,367

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 73

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Summary table of non-financial indicators

SocialWording

Unit

2022

2023

Total number of entities reporting social indicators

Number of entities

24

24% of total Vetoquinol workforce%

Total number of entities reporting safety indicators

Number of entities

100%

100%

24

24

% of total Vetoquinol workforce

%

100%

100%

Total number of employees

Number of employees

2,524

2,483

Workforce Europe

Number of employees

1,391

1,328

Workforce Americas

Number of employees

574

576

Workforce Asia/Pacific and rest of the world

Number of employees

559

579

Total number of men

Number of men

1,324

1,286

% of men in total workforce

%

52%

52%

Total number of women

Number of women

1,200

1,197

% of women in total workforce

%

48%

48%

40.8

41.3

780

755

7.8

8.1

Average age of workforce
Number of managers in workforce

Number of employees

Average seniority
Fixed-term contrats

%

2.7%

1.7%

Permanent contrats

%

97.3%

98.3%

Gender equality index (France)

Index / 100

92

91% turnover (excluding India)

%

9.6%

8.7%

Absenteeism rate

%

5.3%

4.3%

Accidental deaths

Number of accidental deaths00Number of lost-time accidents

Number of workplace accidents

13

6

Lost time injury frequency rate (LFTIFR1)

Number of lost-time
accidents/1,000,000 hours worked

2.9

1.3

Severity rate

Number of days lost/ 1,000 working
hours

0.115

0.018

78%

88%

Annual action plan completion rate
Lost-time accident frequency rate (LFTIFR 2)

Number of lost-time
accidents/1,000,000 hours worked

16.5

19.1

% of employees trained

Employees trained/total number of
employees

95.0%

97.9%

Total number of training hours

Number of training hours

18,198

13,77574 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Summary table of non-financial indicators

GovernanceWording
Percentage of capital held by founders, families and executives

Unit

2022

2023

%

67.02

67.03

Percentage of capital held by employees (excluding management)

%

0.17

0.17

Percentage of capital held in treasury stock

%

0.42

0.42

Free float

%

32.56

32.55

units

11,881,902

11,881,902

yes/noyes

yes

Average number of shares outstanding
Publication of the Board's rules of procedure on the website
Governance structure: Board of Directors with or without separation of
the roles of Chairman/CEO or Supervisory Board + Executive Board

Discontinued Non-dissociatedoperations
CA

Number of Board members

88Number of independent or external members on the Board

4

4

Number of independent Board members as declared by the company

44Number of employee representatives on the Board00

Number of non-voting Board members

00Number of women on the Board

3

3

Number of independent or external women on the Board

2

2

yes

yes

Commitment to comply with the MiddleNext Corporate Governance Code
Number of Board meetings

4

4

87

100

3

3

Audit and Risk Committee

yes

yes

Compensation and/or Appointments Committee

yes

yes

Strategic Committee

yes

yes

Payment policy for directors' fees partly linked to attendance

yes

yes

Formalizing a business conduct and anti-corruption policy

yes

yes

Existence of an whistleblowing system

yes

yes

Existence of a manager or department in charge of CSR/sustainable
development issues

yes

yes

Presence on the Executive Committee (or Management Committee) ofa person in charge of CSR/sustainable development issues

yes

yes

CSR strategy presented to the Board during the year

yes

yes

Average attendance rate of directors at Board meetings%

Total number of specialized Board committees

Stakeholders
Wording

2022

2023

Existence of supplier/subcontractor audits

Unit

yes

yes

Existence of a quality management system

yes

yes

Presentation of IT risks to governance bodies at least once a year

yes

yes

Existence of an Ethics Committee

yes

yes

Intrusion testing of IT systems

yes

yes

Existence of an internal IT charter

yes

yes

Initiatives to optimize the social impact of products/services

yes

yes

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 75

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Report by the independent third-party body

2.13	R EPORT BY THE INDEPENDENTTHIRD-PARTY BODY
Year ending December 31, 2023
To shareholders,
Further to the request made to us by Vetoquinol Groupe
SA (hereinafter "entity") and in our capacity as an independent third-party body ("third party"), accredited by
COFRAC Inspection under number 3-2013 rev. 1, (Accréditation Cofrac Inspection, n° 3-2013 rév. 1, scope available
on www.cofrac.fr), we have performed work designed toprovide a reasoned opinion expressing a conclusion ofmoderate assurance on the historical information (observed or extrapolated) of the extra-financial performancestatement, prepared in accordance with the entity's procedures (hereinafter the "Reporting Criteria"), for the year
ended 12/31/2023 (hereinafter the "Information" andthe "Statement" respectively), presented in the Group's
management report in accordance with the provisions ofArticles L. 225-102-1, R. 225-105 and R. 225-105-1 of theFrench Commercial Code.
Conclusion
Based on the procedures we performed, as described inthe "Nature and scope of our work" section, and on theinformation we have obtained, nothing has come to ourattention that causes us to believe that the non-financial
performance statement is not free from material misstatement and that the Information, taken as a whole, ispresented fairly, in accordance with the Reporting Criteria.
Preparation of the extra-financial performance declaration
The absence of a generally accepted and commonly usedreference framework or established practices on which
to base the assessment and measurement of Information means that different, but acceptable, measurement
techniques can be used, which may affect comparability
between entities and over time.
Consequently, the Information must be read andunderstood with reference to the Standards whose significant elements are presented in the Declaration.
Responsibility of the entity
The Board of Directors is responsible for :• select or establish appropriate criteria for the preparation of Information ;•draw up a Declaration in compliance with legal andregulatory provisions, including a presentation of thebusiness model, a description of the main non-financial
risks, a presentation of the policies applied with regard
to these risks as well as the results of these policies,
including key performance indicators and, in addition,
76 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

the information provided for in Article 8 of Regulation(EU) 2020/852 (green taxonomy);• and to implement such internal control procedures as
it determines are necessary to enable the preparationof information that is free from material misstatement,
whether due to fraud or error.
The Declaration has been drawn up by applying theentity's reference framework as mentioned above.
Responsibility of the independent third-party organization
It is our responsibility, on the basis of our work, to formulate a reasoned opinion expressing a conclusion ofmoderate assurance on:• the compliance of the Declaration with the provisions ofarticle R. 225-105 of the French Commercial Code ;• the sincerity of the historical information (recorded or
extrapolated) provided in application of 3° of I and II of
Article R. 225-105 of the French Commercial Code, i.e.
the results of policies, including key performance indicators, and actions, relating to the main risks.
As it is our responsibility to form an independent conclusion on the Information as prepared by management, weare not authorized to be involved in the preparation of thesaid Information, as this could compromise our independence.
It is not our role to comment on:• the entity's compliance with other applicable legal andregulatory provisions (in particular with regard to theinformation required by Article 8 of Regulation (EU)2020/852 (green taxonomy), the due diligence plan andthe fight against corruption and tax evasion);•
the truthfulness of the information provided for in
Article 8 of Regulation (EU) 2020/852 (green taxonomy);• compliance of products and services with applicableregulations.
Regulatory provisions and applicable professional doctrine
The procedures described below were performed inaccordance with the provisions of articles A. 225-1 etseq. of the French Commercial Code, the professional
guidance issued by the Compagnie Nationale des Commissaires aux Comptes (CNCC) relating to this work inlieu of an audit program, and the International Standard
on Auditing (ISAE) 3000 (revised).
Independence and quality control
Our independence is defined by the provisions of Article
L. 822-11 of the French Commercial Code and the Codeof Ethics for Statutory Auditors. In addition, we have set
up a quality control system comprising documented poli-

STATEMENT OF NON-FINANCIAL PERFORMANCE _ 2
Report by the independent third-party body

cies and procedures designed to ensure compliance withthe applicable laws and regulations, ethical rules andprofessional doctrine of the Compagnie Nationale desCommissaires aux Comptes (CNCC).
Means and resources
Our work mobilized the skills of 3 people and took place
between February 6, 2024 and April 22, 2024, over a totalintervention period of 8 days.
To assist us in our work, we called on our specialists
in sustainable development and corporate social responsibility. We conducted 5 interviews with the people
responsible for preparing the Declaration, representing
in particular the General Management, Administration
and Finance, Risk Management, Compliance, Human
Resources, Health and Safety, Environment and Purchasing Departments.
Nature and scope of work
We planned and performed our work taking into accountthe risk of material misstatement of the Information.
We believe that the procedures we have performed in
the exercise of our professional judgment enable us toprovide a moderate level of assurance:• we have reviewed the activities of all the entities includedin the scope of consolidation and the main risks ;• we have assessed the appropriateness of the Standards
in terms of their relevance, completeness, reliability, neutrality and comprehensibility, taking into account, whereappropriate, best practices in the sector ;• we have verified that the Declaration covers each category of information specified in III of Article L. 225-102-1
concerning social and environmental issues, respect forhuman rights and the fight against corruption and tax
evasion ;• we have verified that the Declaration presents the information required under II of Article R. 225-105 where
relevant to the principal risks and includes, where appropriate, an explanation of the reasons for the absenceof the information required under 2e paragraph of III of
Article L. 225-102-1 ;• we have verified that the Declaration presents thebusiness model and a description of the principal risks
associated with the activity of all the entities includedin the scope of consolidation, including, where relevant
and proportionate, the risks created by its business
relationships, products or services, as well as policies,
actions and results, including key performance indicators relating to the principal risks ;•
we consulted documentary sources and conductedinterviews to:- assess the process for selecting and validating themain risks and the consistency of the results, including the key performance indicators selected, with themain risks and policies presented, and- corroborate the qualitative information (actions andresults) that we considered to be the most important,as presented in Appendix 1. Our work was carried out
at the level of the consolidating entity and in a selection of entities[1] ;• we have familiarized ourselves with the internal control
and risk management procedures implemented by theentity and have assessed the data collection process
aimed at ensuring the completeness and accuracy of
the information ;• for the key performance indicators and other quantitative results that we considered most important arepresented in Appendix 1,•w
 e have implemented:- analytical procedures to check that the data collected
has been properly consolidated and that trends are
consistent ;- detailed tests, based on sampling or other selection
methods, to verify the correct application of definitions
and procedures, and to reconcile data with supporting
documents. These tests were carried out on a selection of contributing entities, covering between 27%
and 100% of the consolidated data selected for thesetests ;
• we have assessed the overall consistency of the Declaration in relation to our knowledge of all the entities
included in the scope of consolidation.
The procedures performed as part of a moderate assurance engagement are less extensive than those required
for a reasonable assurance engagement performedin accordance with the professional standards of theCompagnie Nationale des Commissaires aux Comptes;
a higher level of assurance would have required more
extensive verification work.

Lyon, April 23, 2024
FINEXFI Isabelle Lhoste
Associate

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 77

2 ­_ STATEMENT OF NON-FINANCIAL PERFORMANCE
Report by the independent third-party bodyAppendix 1

Environmental themes

VERIFIED QUANTITATIVE INFORMATION•D rinking water consumption•G as energy consumption•E lectricity consumption• Liquid energy consumption - fuels• Non-hazardous industrial waste• Hazardous industrial waste•E missions in CO equivalent2 Scope 1•E missions in CO equivalent2 Scope 2• Scope 1, 2 and 3 carbon footprint results in percent Process verification

Social themes•B reakdown of workforce by region•B reakdown of workforce by profession•A verage age women, average age men, average age•S hare of under-30s•S hare of over-50s•B reakdown by socio-professional category•V oluntary departure rate
• Part-time work
• Share of fixed-term contracts, Share of open-ended
contracts• Absenteeism rate - Process Audit• HF Equality Index - Process Verification• Total number of training hours France - Processverification• Lost-time accident frequency rate•S
 everity rate
• Number of hazardous situations collected - Processverification

Social issues•R &D expenditure• R&D expenditure as % of sales

VERIFIED QUALITATIVE INFORMATION•
Code of ethics and whistle-blowing system, Whistle-blowing report•Anti-corruption code of conduct, Corruption risk
mapping, Supplier anti-corruption questionnaires(1) Social data: Group scope except for the following indicators: Absenteeism rate, M/F equality index, Number of training hours (France); Number of losttime accidents, Lost-time accident frequency rate, Severity rate, Number of hazardous situations (France, Brazil).
Environmental data: Scope Lure site (France), Vehicle fleet France, Goiania site (Brazil), Vehicle fleet Brazil
Social data: Group scope

78 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

6
CONSOLIDATED FINANCIAL STATEMENTS
6.1	CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME  80
6.2	CONSOLIDATED STATEMENT OF FINANCIAL POSITION

81

6.3	CONSOLIDATED STATEMENT OF CASH FLOWS

82

6.4	STATEMENT OF CHANGES IN CONSOLIDATED EQUITY

83

6.5	NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 84
6.5.1	Overviews 
6.5.2 Key events 
6.5.3	Accounting principles
6.5.4 Financial risk management
6.5.5 Capital management
6.5.6 Information on judgments and estimates
6.5.7 Business combinations
6.5.8 Operating segments – IFRS 8
6.5.9 Research & Development costs
6.5.10 Other purchases and external expenses
6.5.11 Staff costs
6.5.12 Share-based payments – bonus shares
6.5.13 Other operating income and expenses
6.5.14 Non-recurring operating income and expenses
6.5.15 Leases - IFRS 16
6.5.16 EBITDA
6.5.17 Net financial income/(expense)
6.5.18 Income tax6.5.19 Earnings per share
6.5.20 Goodwill
6.5.21 Intangible assets
6.5.22 Property, plant and equipment
6.5.23 IFRS 5 
6.5.24 Other financial assets
6.5.25 Derivative
6.5.26 Impact of change in working capital in the cash flow
statement (CFS)

84
84
85
87
89
90
90
91
93
94
94
95
95
95
96
97
98
98
100
101
103
105
106
106
106

6.5.27 Inventories
6.5.28 Trade and other receivables
6.5.29 Cash and cash equivalents
6.5.30 Capital stock and additional paid-in capital
6.5.31 Financial liabilities
6.5.32 Provisions for employee benefits
6.5.33 Other provisions6.5.34 Trade and other payables
6.5.35 Assets and liabilities by accounting category
6.5.36 Dividends per share
6.5.37 Headcount
6.5.38 Off-balance sheet commitments
6.5.39 Contingent assets and liabilities
6.5.40 Related party disclosures
6.5.41 Post-balance sheet events
6.5.42 Litigation and arbitration
6.5.43 Financial / commercial situation
6.5.45 Fees
6.5.45 Group companies

107
108
109
109
110
112
115
116
117
117
118
118
119
119
119
119
120
120
121

6.6	STATUTORY AUDITORS' REPORT ON THE CONSOLIDATEDFINANCIAL STATEMENTS
122
6.6.1
6.6.2
6.6.3
6.6.4
6.6.5

Opinion
122
Basis for opinion 
122
Justification of assessments - Key audit matters
123
Specific testings 124Other verifications or information required by law andregulations124
6.6.6	Responsibilities of management and persons charged
with corporate governance in relation to the consolidated
financial statements
125
6.6.7	Statutory Auditors' responsibilities relating to the auditof the consolidated financial statements 
125

107
Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 79

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Consolidated statement of comprehensive income

6.1	CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME
In order to present a better view of its economic performance, the Group presents an APM entitled “EBIT before amortization of acquired intangible assets”. This indicator isolates the non-cash impacts of amortization recognized inconnection with acquisitions.
In thousands of euros

Notes

Sales

6.5.8

Purchases consumed

2023

2022

529,271539,779(155,640)(158,537)

Other purchases and external expenses

6.5.10(107,359)(108,962)

Staff costs

6.5.11(157,286)(152,400)(7,659)(7,194)6.5.20/6.5.21(12,344)(11,804)

Depreciation and impairment of fixed assets - IFRS 16(5,887)(5,690)

Provisions and write-backs(3,536)(2,112)

Taxes other than on income
Depreciation and impairment of fixed assets.

Other operating income

6.5.13

6,666

6,935

Other operating expenses

6.5.13(1,213)(1,399)EBIT BEFORE DEPRECIATION OF ACQUIRED ASSETS

85,013

98,617% OF SALES

16.1%

18.3%

Amortization of acquired intangible assets(13,394)(14,056)

EBIT

71,61984,561% OF SALES

13.5%

15.7%

2,645

(10,559)

OPERATING INCOME

74,26474,002% OF SALES

14.0%

13.7%

Non-recurring operating income and expenses

6.5.14

Income from cash and cash equivalents

6.5.163,274

807

Gross cost of debt

6.5.16

(477)

(728)

(441)

(271)

NET COST OF DEBT

6.5.16

2,356

(191)

Other financial income

6.5.16

4,731

6,514

Other financial expenses

6.5.16(4,446)(7,583)

NET FINANCIAL INCOME/(EXPENSE)

6.5.16

Interest paid - Lease liabilities

INCOME BEFORE TAX
Income tax expense

6.5.17NET INCOME EXCL. EARNINGS OF ASSOCIATES

2,642(1,261)

76,90672,742(21,340)(24,744)

55,56647,998

Earnings/(loss) of associates

0

0

CONSOLIDATED NET INCOME

55,56647,998Attributable to: Parent company shareholders

55,56047,9955

2(3,686)

3,730

(57)

1,180

Total comprehensive income for the period, net of tax

51,822

52,908Attributable to: Parent company shareholders

51,81752,90552

Non-controlling (minority) interests
Exchange differences on translation of foreign operations reclassifiable to P/L
Post-tax actuarial gains (losses) not reclassified to P/LOther comprehensive income, net of tax

Non-controlling (minority) interests
Basic EPS (€)

6.5.184.70

4.06

Diluted EPS (€)

6.5.184.70

4.06

80 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Consolidated statement of financial position

6.2	CONSOLIDATED STATEMENT
OF FINANCIAL POSITIONIn thousands of euros

Notes Dec 31, 2023 Dec 31, 2022

ASSETS
Goodwill

6.5.1975,03676,173

Other intangible assets

6.5.20

153,995

168,7096.5.21/6.5.22

75,69570,996

14,004

13,654

Property, plant and equipment
Right-of-use assets (leases)
Investments in associates
Other financial assets

6.5.23

Deferred tax assets

6.5.17

Total non-current assets

-

-

1,491

1,444

8,621

10,632

328,842

341,608

Inventories

6.5.25103,538

116,091

Trade and other receivables

6.5.2699,21685,350

8,509

7,489

Other current assets

6.5.26

4,663

5,973

Cash and cash equivalents

6.5.27

147,464

93,708363,390308,611

Current income tax receivables

Total current assets
Total non-current assets and groups of assets held for sale

-

1,629

692,232

651,848

70,831

70,831

Reserves

400,622

365,745

Net income for the year

55,56047,995Equity attributable to parent company shareholders

527,013484,5719792

527,110484,663

TOTAL ASSETSSHAREHOLDERS’ EQUITY
Capital stock and additional paid-in capital

6.5.28Non-controlling (minority) interests
Shareholders’ equity
LIABILITIES
Non-current financial liabilities

6.5.29Non-current lease liabilities

172

179

9,491

9,382

Deferred tax liabilities

6.5.17

7,169

8,017

Provisions for employee benefits

6.5.30

7,617

7,309

Other provisions

6.5.31

563

803

721

816

Other long-term liabilities
Total non-current liabilities
Trade and other payables

6.5.32Current income tax liabilities
Current financial liabilities

6.5.29Current lease liabilities
Other provisions

6.5.3125,732

26,506125,980

125,867

4,940

5,578

2,987

3,296

4,978

4,564

502

1,071

Other current liabilities

2

11

Total current liabilities

139,390

140,387

Total liabilities

165,122

166,893-291

692,232

651,848

Total liabilities related to a group of assets held for sale
TOTAL EQUITY AND LIABILITIES

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 81

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Consolidated statement of cash flows

6.3	CONSOLIDATED STATEMENTOF CASH FLOWSIn thousands of euros

Notes Dec 31, 2023 Dec 31, 2022

Consolidated net income

55,56647,998Depreciation, amortization and provisions

28,61536,772

Depreciation, amortization and provisions - IFRS 16

5,887

5,690

Elimination of non-cash items

Elimination of (earnings)/loss of associates--

Income tax expense

6.5.1821,34024,744

Interest expense

6.5.17(1,727)456

Interest expense - IFRS 16

441

271

Provisions for employee benefits

161

48

Capital gains (losses) on sales, net of tax

663

167

Other non-cash items--

Income and expenses from share-based payments-

51

Cash flows from operating activities
Tax paid

6.5.18Change in working capital

6.5.26

Net cash flow from operating activities

110,945

116,197(21,921)(31,941)367(21,401)

89,39162,855Acquisition of intangible assets

6.5.21(4,114)(5,526)

Acquisition of property, plant and equipment

6.5.22(14,896)(16,971)

Acquisition of financial assets--

Proceeds from sale of assets

139

579

(10)

(504)

0

904

(18,881)(21,518)

0

0

Repayments - other long-term investments
Cash flows from business combinations

6.5.7

Net cash flow from (used by) investing activities
Capital increase
Net (purchase)/sale of treasury stock

-

0

1,037

2,183

Repayment of financial liabilities(2,637)(2,399)Cash flows from financing activities - IFRS 16(6,159)(5,918)Issuance of debt and other financial liabilities

Interest paid

6.5.31

6.5.17
6.5.17
6.5.30.4

(477)

(737)

2,204

274

(9,465)(9,465)(1)(0)

Investment subsidies and government loans--

Other cash flows from financing activities--

Net cash flow from (used by) financing activities(15,497)(16,063)

Exchange gains (losses)(2,395)205

Net change in cash

52,61825,480Opening net cash and cash equivalents

93,58968,109Interest received
Dividends paid to parent company shareholders
Dividends paid to non-controlling (minority) interests

Change in cash and cash equivalents
Closing net cash and cash equivalents

82 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

6.5.2952,61825,480146,207

93,5896 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Statement of changes in consolidated equity

6.4	STATEMENT OF CHANGESIN CONSOLIDATED EQUITY
In thousands of euros

BALANCE AT 12/31/2021

Capital Translation Actuarial
Other
Total
Net Total equity
NonTotal
stock andreservegains reserves reserves income for
attributable controlling shareholders’additionalandthe yearto parent (minority)
equitypaid-inlossescompany interests
capitalshareholders(Note
6.5.30)70,831(22,021)62,861

441,26391

441,354

-

-

-

-

-

47,99547,9952

47,998

-

3,730

1,180

-

4,910

-

4,910

-

4,910

-

3,730

1,180

-

4,910

47,99552,9052

52,908

Appropriation of earnings

-

-

-

62,861

62,861(62,861)---

Stock option and bonus share plans

-

-

-

51

51

-

51

-

51

Treasury shares

-

-

-

(184)

(184)

-

(184)

-

(184)

Dividends paid by the parent company

-

-

-

(9,465)(9,465)-(9,465)(1)(9,466)

Other

-

-

-

-

0

-

0

(0)

(0)

70,831(18,290)486 383,549 365,745

47,995484,57192

484,663

-

-

-

-

-

55,56055,5605

55,566-(3,686)(57)-(3,743)-(3,743)-(3,743)-(3,686)(57)-(3,743)55,56051,817

5

51,822

Appropriation of earnings

-

-

-

47,99547,995(47,995)---

Stock option and bonus share plans

-

-

-

-

-

-

-

-

-

Treasury shares

-

-

-

90

90

-

90

-

90

Dividends paid by the parent company

-

-

-

(9,465)(9,465)-(9,465)-(9,465)

Other

-

-

-

(0)

(0)

-

(0)

-

(0)

70,831(21,977)429 422,169 400,621

55,560527,01397

527,110Net income for the year
Other comprehensive income,net of tax
Comprehensive income
for the year

BALANCE AT 12/31/2022
Net income for the year
Other comprehensive income,net of tax
Comprehensive income
for the year

BALANCE AT 12/31/2023(694) 330,286 307,571

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 83

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5	NOTES TO THE CONSOLIDATEDFINANCIAL STATEMENTS
6.5.1

Overview

Vetoquinol is a leading international player in animal
health, both for livestock (cattle, pigs) and pets (dogs,cats). Independent and a pure player, Vetoquinol innovates, develops and markets veterinary pharmaceuticals
and non-medical products in Europe, the Americas andAsia-Pacific.
Since its creation in 1933, Vetoquinol has combined innovation with geographic diversification. Strengthening the
product portfolio and acquisitions in high-potential territories ensure hybrid growth for the group. Vetoquinol
employs 2,483 people.

6.5.2

Vetoquinol has been listed on NYSE Euronext Paris since2006 (ticker symbol: VETO).
The parent company, Vetoquinol SA, is a limited company
with its registered office in Magny-Vernois, 70200 Lure.
Vetoquinol SA, the parent company of the Group, iscontrolled by Soparfin.
The consolidated financial statements of the Vetoquinol Group were approved by the Board of Directors
on 19 March 2002. The financial statements will be submitted to the next Annual General Meeting for approval on
28 May 2024.

Key events

6.5.2.1	Continued launch of Simplera andFelpreva®
Vetoquinol continued to bring new products to market:• In Europe, Felpreva®, an internal and external parasiticide for cats. With this launch, the Group continues tostrengthen its position in the pet market with a productthat combines ease of use with a 3-month effect.
• In the United States, Simplera®, an otitis media treatment for dogs.

6.5.2.2	Implementation of a new ERP
system
At the beginning of April, the Vetoquinol Group successfully launched its new ERP system for the planned
10 subsidiaries, including the parent company Vetoquinol
SA. To date, there have been no critical difficulties affecting the company's operations.

6.5.2.3	Resolution of the dispute withminority shareholders and former
shareholders of the VTQ Brazil
CGU
Other operating income and expenses totaled €2.6 million(2022: €10.6 million). This net income recorded for 2023

84 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportmarks the conclusion of discussions on the final acquisition price with the minority shareholders and former
shareholders of Clarion (Brazilian subsidiary), as well as
reflecting the contracted macroeconomic situation anduncertain valuation of the intangible assets recognizedat the time of this subsidiary's acquisition. Please be
reminded that in 2022, following the completion of impairment tests on intangible assets, the balance of goodwill
for the CGU VTQ Brazil was fully impaired to the tune of-9.5 M€.

6.5.2.4 R&D effort
In 2023, the Group has increased its R&D expenditure to
7.6% of sales (2022: 6.0%), reflecting its commitment tosustainably increase R&D spending to support innovation.

6.5.2.5 Russian-Ukrainian conflict
The Vetoquinol Group does not have a direct presence in
Ukraine and Russia. However, the company is exposed tothe consequences of the economic tensions caused bythis conflict, and in particular to sharp increases in thecost of certain raw materials, energy, and logistics.

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.3

Accounting principles

6.5.3.1	Overall frameworkand environment
The consolidated financial statements for 2023 have been
prepared in accordance with the International AccountingStandards and Interpretations (IAS/IFRS) adopted by theEuropean Union and applicable at December 31, 2023.
These standards and interpretations have been appliedconsistently over the years presented.
The application of the other standards, amendments andinterpretations effective from January 1st, 2023 did nothave a material impact on the Group's financial statements.
The financial statements have been prepared in accordance with the historical cost convention, with the
exception of financial assets and liabilities measured atfair value through profit or loss (including derivatives).
The preparation of financial statements in accordancewith IFRS requires the use of certain accounting estimates, the main ones of which are described in note 6.5.6.

6.5.3.2	Consolidation and businesscombinations
6.5.3.2.1 Consolidation scope
A subsidiary is defined as an entity controlled by theGroup. The Group is deemed to have control when it:•h olds power over the entity;• is exposed, or has the right, to variable returns due to its
relationship with the entity;• has the ability to exercise its power in such a way as toinfluence the amount of returns it obtains.

Companies are consolidated from the date on which
control is transferred to the Group, and deconsolidated
from the date on which the Group ceases to exercise
control over them.
The purchase method is used to account for acquisitions of subsidiaries (as defined by IFRS 3). The cost ofan acquisition is comprised of the fair value of assets
transferred, liabilities assumed or incurred, and equity instruments issued by the acquirer at the acquisition date.
Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are initiallymeasured at fair value at the acquisition date, regardlessof the amount of minority interests. The excess of thecost of acquisition over the Group's interest in the fairvalue of assets, liabilities and contingent liabilities
recorded constitutes goodwill (note 6.5.20). Conversely,
if the Group's share of the fair value of assets, liabilities
and contingent liabilities exceeds the acquisition cost,the excess is immediately recognized in the income statement.
The interests of non-controlling shareholders are presented in the balance sheet in a specific category ofshareholders' equity. Their share of consolidated net
income and other comprehensive income is presented
separately after these two aggregates.
Intra-group balances and transactions, including profits
and losses and dividends, are eliminated on consolidation.
The Group comprises Vetoquinol SA and its subsidiaries.
It does not own any jointly-controlled companies or associates.
Please refer to Note 6.5.45, "Group Companies," for a
detailed overview of the scope of Group companies.

The Group consolidates subsidiaries over which it
exercises de jure or de facto exclusive control. This ispresumed in cases where the Group holds, directly or
indirectly through its subsidiaries, more than half of thevoting rights. The percentage interest method is used todetermine non-controlling interests.
The Group accounts for jointly-controlled companies andcompanies over which it exercises significant influence
using the equity method. The activity of these entities ispresented separately in our consolidated income statement, on a dedicated line, before net income.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 85

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.3.3 Business combinations
Acquisition costs, other than those related to the issuanceof debt or equity securities, are expensed as incurred inconnection with a business combination.
Within one year of the acquisition date, the following
adjustments are made:• changes in fair value linked to facts and circumstances
existing at the acquisition date result in an adjustment
to the cost of the business combination;• changes in fair value arising from events subsequent
to the acquisition date are recognized in the income
statement;• beyond this period, any price adjustment arising fromthe business combination is recognized in the income
statement.
The Group has 12 months from the acquisition date to
finalize the accounting for the business combination inquestion.

6.5.3.4 Foreign currency translation
6.5.3.4.1	Functional currency andpresentation currency
The financial statements of each Group entity include
items that are measured using the currency of the primaryeconomic environment in which the entity operates, also
known as the functional currency. The consolidated financial statements are presented in euros, the company's
presentation currency.

6.5.3.4.2 Transactions, assets and liabilities
In Group companies, transactions in foreign currencies are translated into the functional currency at theexchange rate prevailing at the time of the transaction.
Monetary assets and liabilities denominated in foreign
currencies are translated at the exchange rate prevailingat the balance sheet date.
Non-monetary items are translated using the historicalrate at the transaction date when measured at historicalcost, and using the rate at the date of determination offair value when measured at fair value.
Exchange differences arising from these transactions arerecognized in the income statement, with the following
exceptions:• those relating to a gain or loss recognized directly inother comprehensive income, which are recognized inequity;• those arising from the translation of a net investment ina subsidiary, which are recognized in other comprehensive income and taken to income when the investment
is sold.

86 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

6.5.3.4.3	Translation of financial statementsof Group companies
The financial statements of Group companies denominated in functional currencies other than the presentation
currency are translated into the presentation currency as
follows :• assets and liabilities are translated at the closing rate oneach balance sheet date ;• Income statement items are translated at the averageannual exchange rate or at the exchange rate on thetransaction date for significant transactions;• all resulting translation differences are recognized as aseparate component of other comprehensive income.

6.5.3.5 Impairment of assets
In accordance with the requirements of IAS 36, the Groupassesses whether there is any indication that an asset
may be impaired. If any such indication exists, the Groupestimates the asset's recoverable amount. Additionally,
the Group tests annually for impairment an intangible
asset with an indefinite useful life, or an intangible asset
not yet ready for use, by comparing its carrying amountwith its recoverable amount.
An impairment loss is recognized when the carrying
amount of an asset exceeds its recoverable amount. The
recoverable amount of an asset is the higher of its fairvalue less costs to sell and its value in use.
For the purposes of assessing impairment, assets aregrouped into Cash Generating Units (CGUs), which represent the lowest level of independent cash flow. The CGUs
defined for the Vetoquinol Group are as follows: Vetoquinol United States, Vetoquinol Canada, Vetoquinol
France, Vetoquinol United Kingdom, Vetoquinol Belgium,
Vetoquinol Switzerland, Vetoquinol Czech Republic, Vetoquinol Austria, Vetoquinol Poland, Vetoquinol Ireland,
Vetoquinol Germany, Vetoquinol Italy, Vetoquinol Scandinavia, Vetoquinol India, Vetoquinol Asia, Vetoquinol
Australia, Vetoquinol Brazil and FarmVet Systems.
For non-financial assets (other than goodwill) that havebeen impaired, any reversal of the impairment loss isreviewed at each annual or interim closing date. Impairment losses are charged first to goodwill. Any unallocatedsurplus is allocated to the assets associated with theCGU.

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.3.6	Climate-related estimates andassumptions
As part of its strategic ambition, the Group has defined
actions aimed at reducing its impact on the environmentand climate.

6.5.4

At December 31, 2023, based on the work already undertaken, the Group has not identified any item that could
have an impact on the consolidated financial statements.

Financial risk management

6.5.4.1	Foreign exchange risk
management
The Group centralizes the risk of foreign exchange fluctuations on subsidiaries with industrial sites and, as far
as possible, on the parent company, Vetoquinol SA, by
ensuring that distribution subsidiaries invoice and are
invoiced in their operating currency.
As a result, distribution subsidiaries are not exposed tocurrency risk. At Vetoquinol SA, foreign currency flows
are centralized, and hedging instruments may be put inplace as needed. In most cases, these instruments havea term of less than one year, and there are no outstanding
instruments at the balance sheet date. Consequently,
the hedging provisions of IAS 39 are not applicable at
December 31, 2023 or December 31, 2022.
The Group is a net seller of currencies in circulation, suchas USD (approx. 7.6 MUSD) and GBP (approx. 2.6 MGBP).
The Group's net position is in balance with its needs andresources for other currencies.

As previously stated, the foreign exchange risk associatedwith the activities of subsidiaries essentially involves only
a risk of variation in the consolidated income statement.
Based on the accounts drawn up to the end of 2023 andfor foreign subsidiaries only, a 10% appreciation of theeuro against all other currencies would have resulted
in a €30.2 million decline in consolidated sales (2022:€30.7 million) and a €3.8 million decline in consolidated
operating income (2022: €4.4 million).
Conversely, a 10% appreciation of the euro against
other currencies would have resulted in an increaseof €37.0 million in sales (2022: €37.5 million) and a€4.6 million boost to consolidated operating income(2022: €5.4 million).
Due to sales in foreign currencies, the company is
exposed to foreign exchange risk between the date of
invoicing and the date of collection in foreign currencies,
as well as the sale of foreign currencies on the market.
Foreign exchange gains and losses, as well as any gains
and losses on hedging transactions, are recognized in thefinancial result. Most of these transactions are enteredinto and settled during the year, over very short periods,
which explains why no amount is recorded in the balance
sheet at the balance sheet dates.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 87

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

The analysis of the Group's exposure to currency risk (IFRS 7), based on notional amounts, is as follows:
In thousands of euros

EUR

USD

CAD

GBP

INR

PLN

BRL

AUD

CHF

Other
currencies

Trade receivables

35,527

15,865

11,612

10,553

Impairment of trade receivables(1,993)

-

(2)

(14)

Net trade receivables

33,534

15,865

11,610Prepayments

1,599

74

485

Prepaid expenses

2,476

264

Receivables from government
agencies

2,647

-

Total

4,437

402

6,668

1,682

1,051

4,694

92,491

(226)

(154)

(336)

-

(33)

(412)

(3,169)10,539

4,210

248

6,332

1,682

1,019

4,282

89,322

-

42

7

279

-

2

22

2,510

311

126

69

139

116

18

2

686

4,207

-

74

477

500

1,341

17

46

1,093

6,195

Dec. 31, 2023

Other operating receivables

100

-

-

45

-

22

43

23

-

33

266

Miscellaneous receivables

1,001

129

10

0

17

1

188

0

2

31

1,379

Provisions
Total other receivables

-

-

-

-

-

-

-

-

-

-

-

7,821

467

806

246

605

669

1,968

58

52

1,865

14,556

Trade and other payables

78,43912,71010,457

9,297

3,036

2,914

3,635

1,372

687

3,436

125,982

Net trade and other payables

78,43912,71010,457

9,297

3,036

2,914

3,635

1,372

687

3,436

125,982(37,084)

3,621

1,959

1,489

1,780 (1,997)

4,666

368

384

2,711

(22,104)

EUR

USD

CAD

GBP

INR

PLN

BRL

AUD

CHF

Other
currencies

Total

Trade receivables

32,773

10,812

9,521

5,403

4,266

1,490

5,963

1,406

652

5,707

77,993

Total gross balance sheet
exposure

In thousands of euros

Dec. 31, 2022
Impairment of trade receivables(2,163)

(18)

(2)

(8)

(243)

(293)

(456)

-

(20)

(169)

(3,373)

Net trade receivables

30,61010,794

9,519

5,395

4,023

1,198

5,507

1,406

631

5,538

74,620Prepayments

1,182

77

259

-

69

6

412

-

-

14

2,020

Prepaid expenses

3,394

773

571

119

67

145

59

12

7

378

5,524

Receivables from government
agencies

2,813

-

-

156

379

278

1,673

26

50

1,475

6,851

Other operating receivables

494

458

-

45

-

19

41

4

-

36

1,096

Miscellaneous receivables

693

(0)

7

0

29

96

250

-

110

27

1,211

-

-

-

-

-

-

-

-

-

-

-

Provisions
Total other receivables

8,576

1,308

837

320

544

543

2,435

43

167

1,931

16,702

Trade and other payables

75,005

11,022

10,016

9,174

3,031

2,591

8,883

1,396

742

4,019

125,878

Net trade and other payables

75,005

11,022

10,016

9,174

3,031

2,591

8,883

1,396

742

4,019

125,878(35,820)

1,079

340

(3,459)

1,536

(851)

(941)

53

57

3,451

(34,555)

Total gross balance sheet
exposure

88 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.4.2 Interest rate risk management
The Group's general interest-rate risk management policy
is to use interest rate swaps. In accordance with IAS 39,
the Group applies hedge accounting when the conditions
are met. In the event that these conditions are not met
or the stakes are not significant, as has been the case inrecent years, derivatives are recorded in the balance sheet
at fair value, with any change in fair value recognized in
the income statement in accordance with the provisionsof IAS 39.

The collection of trade receivables and cash is handled
locally by each of the Group's subsidiaries. The Group's
Finance Department is responsible for ongoing reportingof subsidiaries' cash movements. This enables the Groupto refine its net positions and maintain its ability to meetits financial commitments.

6.5.4.4 Credit risk management

The Group's exposure to interest-rate risk is not material,and primarily concerns two balance sheet items: financial
debt and cash. As of December 31, 2023, 92.9% of theGroup's financial debt (including bank overdrafts) boreinterest at a fixed rate, compared to 99.3% in 2022. As of
December 31, 2023, the Group had €1.3 million in floating-rate commitments (2022: €0.1 million).

Credit risk represents the risk of financial loss to theGroup should a customer or counterparty to a financial
instrument default on its contractual obligations. For theGroup, this risk can only arise from trade receivables.
As far as investments are concerned, the Group limits
its exposure to credit risk by investing only in liquid andsecured securities. Given the characteristics of the DATs
used, management believes that bank counterparties will
not default.

The Group's investments with major banks are at fixed
rates with guaranteed capital. Based on the financial
statements at the end of 2023, an increase of 100 basis
points in interest rates would have resulted in an increase
in income of €703,000 (€653,000 in 2022).

The Group's exposure to credit risk is mainly influenced by
the individual characteristics of its customers. The Groupcurrently distributes its products in over a hundred countries worldwide, supported by subsidiaries in 24 countries
and a network of 100 distribution partners.

6.5.4.3 Liquidity risk management
The Group's cash and cash equivalents, excluding bankoverdrafts, totaled €147.5 million at December 31, 2023
(2022: €93.7 million), and consisted of cash and fixed-interest-bearing time deposits. As of December 31, 2023,
these DATs and cash equivalents totaled €75.9 million(2022: €37.9 million).
In 2023, the Group generated cash flow before net
cost of debt and tax of €110.9 million, compared with
€116.2 million the previous year.
Given the Group's financial position at December 31, 2023,
the Group considers that it is not exposed to any liquidity
risk. As of December 31, 2023, the Group's cash position
was sufficient to meet its financial maturities of less than
one year. Net cash and cash equivalents, excluding IFRS
16, stood at €144.3 million at December 31, 2023 (2022:€90.2 million).

6.5.5

In certain geographical areas, the concentration ofwholesalers and/or purchasing groups could result in arevision of Group margins following the renegotiation ofthese contracts. However, this risk appears limited, as theGroup is sufficiently large and diversified geographicallyand by product not to be subject to such pressure. By
way of illustration, the Group's largest wholesale distributor accounts for 7.0% of 2023 consolidated sales (2022:
6.7%).
Customers who do not meet the Group's creditworthiness
requirements can only enter into transactions if they pay
for their orders in advance.
The sale of goods is subject to a retention-of-title clause,
which provides the Group with a guarantee in the eventof non-payment. The Group does not require specific guarantees for trade and other receivables.
The carrying amount of the Group's financial assets represents the maximum exposure to credit risk at December
31, 2023, i.e. €98.9m (2022: €86.5m).

Capital management

The Group's policy is to maintain a solid capital base inorder to preserve the confidence of investors, creditors,
and the market and to support the future developmentof the business. The Board of Directors, with the assistance of Executive Management, monitors the number

and diversity of shareholders, the return on equity, and thelevel of dividends paid to holders of common shares.
The Group occasionally makes purchases of its own
shares on the market. The pace of these purchases is
contingent upon market prices. These shares are prima-

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 89

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

rily utilized in conjunction with stock option and bonus
share plans. The Chairman and/or the Chief Executive
Officer will make decisions regarding purchases or sales
on a case-by-case basis. The Group does not have adefined share buyback program. In addition to these irre-

6.5.6

During the year, the Group did not modify its capital management policy.

Information on judgments and estimates

The preparation of financial statements requires management to exercise judgment and to make estimates andassumptions that affect the reported amounts of assets
and liabilities, income and expenses, and disclosures ofcontingent assets and liabilities. The estimates made andthe underlying assumptions adopted are estimated on
the basis of past experience and other factors considered reasonable in the light of current circumstances andforecasts. Consequently, actual values may differ fromestimated values.

6.5.7

gular transactions, the Group has a liquidity contract (seeNote 6.5.30).

The estimates and assumptions prepared on the basis of
information available at the balance sheet date relate to
the following:•p rovisions for trade receivables and year-end discounts;• the amount of the provision for expected credit losses(IFRS 9);•p
 roduct life cycle duration;• provisions for restructuring, environmental issues andlitigation;
the valuation of goodwill, intangible assets and pro•
perty, plant and equipment acquired and their estimateduseful life;•p ension commitments.

Business combinations

6.5.7.1	Reconciliation of purchase price with cash outflow as per the cash flow
statement
There were no business combinations in 2023. For yourreference, on January 26, 2022, the Group finalized theacquisition of all the shares in Vetoquinol Zenoaq, ourJapanese subsidiary. This event had no impact on good-

90 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportwill. However, it did result in a cash inflow impact on
the Group's cash flow statement in the line dedicated tochanges in the scope of consolidation and business combinations, with an inflow of €904,000.

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.8

Operating segments - IFRS 8
6.5.8.1 Segment reporting - IFRS 8

For the 2023 and 2022 financial years, sales are generated
primarily by the sale of veterinary products and services.
The Group does not generate revenue from patent, knowhow, manufacturing, or brand licenses.

In accordance with IFRS 8, the segment information presented is based on internal management data reported to
the Group Operations Committee, the Group's chief operating decision-maker. The Group's operating segments are
geographical segments, and are monitored individually interms of internal reporting.

In accordance with IFRS 15, revenue is defined as thevalue of the payment that the Group anticipates receivingin exchange for the transfer of goods or services to its
customers. Group sales are recognized upon transfer
of control of the products, after deduction of trade discounts and rebates.

A geographical segment is defined as a group of assets
and operations engaged in providing products or services in a particular economic environment, and whichis exposed to risks and profitability that differ from thoseof the other economic environments in which the Group
operates.

To account for its sales, the Group follows the steps outlined below:
The following steps are taken to account for sales:• Contract identification• Identification of the different performance obligations in
the contract
 etermination of the transaction price•D•A
 llocation of the transaction price• Income recognition when benefit obligations are met

The Group's worldwide organization is divided into threezones, each of which is defined by the location of theGroup's assets and operations.
The Group's geographical segments are as follows:• Europe• Americas• Asia/Pacific, distributors and rest of the world
Additionally, the Group monitors and reports on the proportion of sales generated by pets and livestock.

6.5.8.2 Operating segment results for fiscal 2023
In thousands of euros
By asset location

EuropeUSA

Americasexcl. USA

Asia/Pacific(rest of theworld)

Consolidated
total

Sales

392,664

123,602112,744

60,632

689,642Inter-segment sales(122,454)(1,923)(35,960)(35)(160,371)

Total external sales

270,210

121,679

76,78460,597529,271

EBIT

34,85017,336

12,566

6,867

71,619Non-recurring operating income and expenses
Operating income

(4)

23

2,626

0

2,645

34,846

17,35815,192

6,867

74,264

Net financial income/(expense)

2,642

Income before tax

76,906

Income tax(21,340)

Income after tax

55,566

Earnings/(loss) of associates-

CONSOLIDATED NET INCOME

55,566

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 91

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

Tracking by destination zone or end market (geographical area).
In thousands of euros
By region

EuropeUSA

Americasexcl. USA

Asia/Pacific(rest of theworld)

Consolidated
total

Sales

349,798

151,844

97,332

90,668689,642Inter-segment sales(98,925)(31,258)(19,165)(11,023)(160,371)

TOTAL EXTERNAL SALES

250,873

120,585

78,167

79,645529,271

Pets

Livestock

Consolidated
total

Sales

490,634

199,007689,642Inter-segment sales(118,880)(41,491)(160,371)

TOTAL EXTERNAL SALES

371,755

157,516

529,271

The Vetoquinol Group also tracks sales by species.
In thousands of euros
By species

6.5.8.3 Operating segment results for fiscal 2022
In thousands of euros
By asset location

EuropeUSA

Americasexcl. USA

Asia/Pacific(rest of theworld)

Consolidated
total

Sales

403,465

112,766

104,91168,924690,067Inter-segment sales(126,832)(2,906)(20,458)(93)(150,288)

Total external sales

276,633

109,860

84,454

68,832539,779

EBIT

45,393

22,591

3,100

13,47784,561

Non-recurring operating income and expenses(1,088)0(9,471)

0(10,559)

Operating income

44,305

22,591

6,371

13,477

Net financial income/(expense)

74,002(1,261)

Income before tax

72,742

Income tax(24,744)

Income after tax

47,998

Earnings/(loss) of associates-

CONSOLIDATED NET INCOME

47,998Tracking by destination zone or end market (geographical area).
Asia/Pacific(rest of theworld

Consolidated
total

107,212

113,865

690,067(19,768)(20,795)(20,308)(150,288)

107,92186,41793,557539,779

Pets

Livestock

Consolidated
total

Sales

477,462

212,605

690,067Inter-segment sales(112,152)(38,136)(150,288)

TOTAL EXTERNAL SALES

365,310

174,469

539,779

In thousands of euros
By geographical area

EuropeUSA Americas excl.
USA

Sales

341,302

127,689

Inter-segment sales(89,418)

TOTAL EXTERNAL SALES

251,884

The Vetoquinol Group also tracks sales by species.
In thousands of euros
By species

92 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.8.4 Other non-cash segment items included in the income statement
In thousands of euros

EuropeUSA Americas excl.
USA

Asia/Pacific(rest of theworld)

Consolidated
total

(554)

(25,738)

31/12/2023
Depreciation and amortization(19,557)(2,431)(3,196)

Provisions and write-backs(1,184)(1,671)

(119)

(562)

(3,536)

Depreciation - IFRS 16(3,641)

(762)

(892)

(593)

(5,887)

Goodwill impairment

-

-

-

-

Expenses on grants of bonus shares

-

-

-

-

(2,527)(3,223)(581)(25,860)

(823)

(249)

(1,010)(30)(2,112)(3,472)

(670)

(894)

(655)

(5,690)31/12/2022
Depreciation and amortization
Provisions and write-backs
Depreciation - IFRS 16(19,528)

Goodwill impairment
Expenses on grants of bonus shares-(9,475)-(9,475)

(72)

-

-

(72)

6.5.8.5 Segment assets, liabilities and investments
The segment assets and liabilities presented here include deferred taxes.
In thousands of euros

EuropeUSA

Americasexcl. USA

Asia/Pacific Consolidated
total(rest of theworld)

December 31, 2023
Assets479,244

77,54478,57756,867692,232

Liabilities

118,154

3,906

27,783

15,279165,122

Acquisition of assets

15,723

223

1,750

35

17,731---

Acquisition of assets – IFRS 3 – Business combinations-

December 31, 2022
Assets411,006

81,55389,61868,042

650,219

Liabilities

92,494

19,10436,991

18,304

166,893

Acquisition of assets

22,786

282

1,153

278

24,499---Acquisition of assets – IFRS 3 – Business combinations

6.5.9

-

Research & Development costs

Research and development costs expensed in 2023 total €40.1 million, representing 7.6% of sales (2022: €32.6 million,
or 6.0% of sales).

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 93

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.10 Other purchases and external expenses
In thousands of euros

2023

2022

General subcontracting

19,42815,414

Lease and rental payments (*)

1,993

2,189

Maintenance

4,977

5,112

Insurance

1,794

1,786

Analyses and research

1,784

2,814

Third-party staff

1,378

2,231

Fees and commissions paid to intermediaries

24,417

24,610Advertising, publications, public relations

23,11523,569

Freight and collective transportation of staff

10,107

13,008Business travel and entertainment

11,646

10,661

Postage and telecommunications

1,700

2,007

Royalties on concessions, patents, licenses, trademarks, etc.
Other external services
Miscellaneous
TOTAL

983

1,097

3,151

3,529

886

936

107,359

108,962(*) In 2023, €6,146k (€5,913k in 2022) is deducted from leases in connection with the IFRS 16 restatement (commercial leases, vehicle and IT equipment
leases). The residual amount corresponds to short-term leases outside the scope of IFRS 16.

The International Financial Reporting Standards (IFRS) 16 standard introduces a unified lease accounting model for
lessees. This model recognizes a right of use as an asset and a lease liability as a liability. In the income statement, thelessee recognizes depreciation and interest expense..

6.5.11 Staff costs
In thousands of euros

2023

2022

Wages and salaries

118,701

114,818

Social security charges (*)

36,42236,225

Severance pay

1,295

606

Provisions for employee benefits (Note 6.5.32)

832

907

Employee long-term benefits – actuarial gains and losses recognized to P/L

35

(230)

-

-

Expenses on grants of stock options
Expenses on grants of bonus shares
TOTAL EMPLOYEE BENEFITS(*) The cost of defined-contribution pension plans is included in total payroll costs.

94 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report-72

157,286

152,4006 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.12 Share-based payments - bonus shares
As of the end of 2023, no further bonus share plans were outstanding.
A bonus share plan was established in 2020. The impact of the application of IFRS 2 for the 2022 financial year was
72 K€. Bonus shares are valued on the basis of the share price at the grant date, less the present value of dividends notreceived during the vesting period (Black & Scholes valuation model). The shares distributed under this plan were fully
distributed in fiscal 2022.

6.5.13 Other operating income and expenses
In thousands of euros

2023

2022

Operating grants

290

258

Investment grants transferred to income for the year

99-

Expense reclassifications

10

413

Gains on asset sales
Research tax credit (Crédit d’Impôt Recherche - CIR)

139

579

5,087

4,095

Other income

1,041

1,591

OTHER OPERATING INCOME

6,666

6,935

(52)

(281)

Other expenses

Book values of assets sold

(1,161)(1,118)OTHER OPERATING EXPENSES(1,213)(1,399)

5,453

5,537

TOTAL

Vetoquinol's CIR is related to research expenditure and is therefore recognized in operating income.
Other expenses include a loss on receivables of €0.2m. At the end of 2022, other expenses included bad debt losses of€0.3 million.
Other products include :In thousands of euros

2023

2022

Freight costs passed on to customers

289

580

Compensation received*

55

14

-

-

Fees and royalties-

Net asset disposals
Other

697

996

TOTAL

1,041

1,591

6.5.14 Non-recurring operating income and expenses
In thousands of euros

2023

2022

Restitution of escrow account (Brazil)

3,748

-

Net proceeds from debt payable to minority interests (Brazil)

2,449

-

23

4

Miscellaneous (USA)
Other operating income
Impairment of intangible assets (FarmVet Systems)
Impairment of intangible assets and property, plant and equipment (Brazil)
Impairment of goodwill (Brazil)
Miscellaneous, penalties (France)
Other non-recurring operating expenses
TOTAL

6,220

4

-

(1,009)(3,573)--(9,475)(2)(32)(3,575)(10,563)2,645(10,559)

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 95

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

During the first half of 2023, the Group concluded discussions on the final acquisition price with the minority
shareholders and former shareholders of Clarion (CGU
VTQ Brazil), resulting in a net profit of €2.6 million. This
profit is distributed as follows:• The entire escrow account was released in favor of Vetoquinol for €3.7 million.
• Additionally, a net gain of €2.4 million was recognized on
the balance of shares acquired, resulting from the reduction in debt initially recognized in 2019. At December 31,

2022, debt amounted to €5.2 million, and the priceactually paid to minority shareholders was €2.8 million.
• Finally, an impairment of €3.5 million was recognized on
the acquisition of Clarion's intangible assets.
In 2022, the Group made the decision to cease operationsof FarmVet Systems outside of the UK. Consequently, we
have taken an exceptional write-off of the non-patented
developed technology asset recognized for the area
outside the UK.

6.5.15 Leases - IFRS 16
The leases at the transition date are primarily comprisedof contracts that qualified as operating leases under
IAS 17.
For this transition, right-of-use assets have been valued at
January 1, 2019, based on the discounted rental amount.
The most significant changes introduced by this standard
are as follows:• The recognition of a right-of-use asset of €14.0 million at
December 31, 2023 (€13.7 million at December 31, 2022)
and a financial liability of €14.5 million at December 31,
2023 (€13.9 million at December 31, 2022).
• Neutralization of rental expenses for €6.1 million in 2023(€5.9 million in 2022). Conversely, depreciation andfinancial expenses are now recorded at 5.9 million euros
and 441,000 euros, respectively, in 2023 (5.7 million
euros and 271,000 euros in 2022).
The principles are as follows:•
The lease term for a contract is the non-cancellable
period, unless the Group is reasonably certain of exercising the renewal or termination options provided for in
the contract.
• The discount rate used to calculate the right of use andthe rental liability is determined on the basis of the marginal debt ratio at the contract commencement date.

• Liabilities are valued at the present value of remaining
lease payments, discounted using the incremental borrowing rate of each lessee (entity by entity).
• In the absence of an implicit rate defined in the contract,the discount rate applied is the average 10-year marginal rate that the lessee would have had to pay.
The average discount rate for rental liabilities as ofDecember 31, 2023, is 3.0% (2.7% as of December 31,2022). This discount rate is representative of the weighted
average rate applied to rental debt.
The main contracts that have been restated are property
leases and transport vehicle leases.
The Group has elected to utilize the two exemptions
provided for in IFRS 16, which permit the exclusion ofshort-term contracts and contracts for low-value assets
from the balance sheet:•S hort-term leases of 12 months or less.
• Leases on low-value assets: these concern leases where
the replacement value of the assets is less than or equal
to US$5,000.

The table below outlines the rights of use recognized as assets, by asset class.
In thousands of euros
Land
Buildings
Plant, machinery and equipment
VehiclesFurniture, office equipment, hardware
TOTAL

96 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Dec 31, 2023

Dec 31, 2022

0

1

8,628

9,710

1

2

5,185

3,736

190

206

14,004

13,6546 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

IMPACT ON THE FINANCIAL STATEMENTS (IN THOUSANDS OF EUROS)IFRS 16 balance sheet impact

Dec 31, 2023

Dec 31, 2022

Pre-IFRS 16 non-current assets

314,838

327,954

Right-of-use assets (leases)

14,004

13,654

POST-IFRS 16 NON-CURRENT ASSETS

328,842

341,608

Pre-IFRS 16 current liabilities

134,411

135,823

Lease liabilities due in less than one year

4,978

4,564

POST-IFRS 16 CURRENT LIABILITIES

139,390

140,387

Pre-IFRS 16 non-current liabilities

16,241

17,124

Lease liabilities due in over one year

9,491

9,382

POST-IFRS 16 NON-CURRENT LIABILITIES

25,732

26,506

INCOME STATEMENT - IFRS 16 IMPACT

2023

2022

(113,505)(114,875)

6,146

5,913

POST-IFRS 16 EXTERNAL EXPENSES(107,359)(108,962)

Pre-IFRS 16 depreciation and impairment of fixed assets(12,344)(11,804)

Depreciation and impairment of fixed assets - IFRS 16 impact(5,887)(5,690)

POST-IFRS 16 DEPRECIATION AND IMPAIRMENT OF FIXED ASSETS(18,231)(17,494)

(477)

(728)

Pre-IFRS 16 other purchases and external expenses
Canceled rent payments

Pre-IFRS 16 gross cost of debt
Interest paid - Lease liabilities

(441)

(271)

POST-IFRS 16 GROSS COST OF DEBT

(917)

(998)

(21,340)(24,744)--(21,340)(24,744)

(182)

(48)

Pre-IFRS 16 income tax expense
Deferred tax - IFRS 16 impact
POST-IFRS 16 INCOME TAX EXPENSETOTAL IMPACT ON INCOME STATEMENT

6.5.16 EBITDA
In thousands of euros

2023

2022

Operating income

74,26474,002

Provisions and write-backs recorded under non-recurring operating income andexpenses

3,573

10,358Provisions and write-backs

3,536

2,112

Depreciation and impairment of fixed assets

25,73825,860Depreciation and impairment of fixed assets - IFRS 16

5,887

5,690

112,997

118,021

21,3%

21,9%

EBITDA% OF SALES• Excluding the favorable non-recurring impact of the €6.1 million reduction in the acquisition price of Clarion, GroupEBITDA would have been €106.9 million (20.2% vs. revenues).

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 97

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.17 Net financial income/(expense)
In thousands of euros
Interest income from cash and cash equivalents
Net gains on sale of cash equivalents
INCOME FROM CASH AND CASH EQUIVALENTSInterest on bonds

Dec 31, 2023

Dec 31, 2022

3,274

807

-

-

3,274

807

-

-

Interest on borrowings and overdrafts

(477)

(728)

Interest on other borrowings - IFRS 16

(441)

(271)

-

-

GROSS COST OF DEBT

(917)

(998)

NET COST OF DEBT

2,356

(191)

Dec 31, 2023

Dec 31, 2022

4,673

4,578

Interest on finance leases

In thousands of euros
Currency gains
Other income
OTHER FINANCIAL INCOME
Financial expenses related to employee benefits
Currency losses
Other expenses
OTHER FINANCIAL EXPENSES
OTHER FINANCIAL INCOME AND EXPENSES

58

1,936

4,731

6,514

(161)

(48)

(4,066)(5,273)(219)(2,262)(4,446)(7,583)285(1,069)6.5.18 Income tax
Deferred taxes are recognized in respect of temporary
differences between the tax base of assets and liabilities
and their carrying amount in the consolidated financial
statements. No deferred tax is recognized if it arises fromthe initial recognition of an asset or liability relating to atransaction, other than a business combination, which,at the time of the transaction, affects neither accounting
profit nor taxable profit. No deferred tax liability is recognized on initial recognition of goodwill.
Deferred taxes are determined using tax rates (and taxlaws) that have been enacted or substantively enacted by
the balance sheet date and are expected to apply when
the deferred tax asset is realized or the deferred tax liability is settled.

For the purposes of calculating the deferred taxes ofFrench companies, the standard French corporate income
tax rate of 25.83% is applied, as set out in the 2023 tax
legislation. This is in line with the 2022 rate of 25.83%.
In the event that the realization date of the temporary
difference is after 2023, the associated deferred taxes arecalculated at the rate of 25.83%.
Vetoquinol SA underwent a tax audit over the period 2022
and 2023, covering the 2019 and 2020 financial years aspart of its business activities. The audit concluded on
December 13, 2023, with no significant tax reassessment.

Deferred tax assets are recognized only to the extent that
it is probable that future taxable profit will be available
against which the temporary differences can be utilized.
Income tax expense breaks down as follows:
In thousands of euros
Current income tax expense

Dec 31, 2023

Dec 31, 2022

(20,292)(24,080)

Deferred tax income/(expense)(1,047)

(664)

TOTAL

(21,340)(24,744)98 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

The reconciliation between theoretical tax at the statutory rate in France and effective tax is as follows:
Dec 31, 2023

Dec 31, 2022

Net income for the year

In thousands of euros

55,56647,998

CIR restatement(5,087)(4,080)

(403)

(840)

(2,626)

9,475

-

-

CVAE restatement as per IAS 12
Non-recurring items - GW impairment(Earnings)/loss of associates
Income tax expense

21,34024,744

Income before tax adjusted for tax credits

68,79077,296

Theoretical tax at 25.83% (2022: 25.83%)

17,765

19,962Non-deductible expenses and non-taxable income

1,570

119

Impact of change in tax rate
Change in tax losses b/fwd and c/fwd
Tax rate differences for foreign companies
Other taxes (under IAS 12) (*)
Impact of reduced rate

-

(297)

736

2,626

(1,116)(2,010)

973

1,139

32

(59)

Withholding taxes

1,261

2,430

Taxes with no tax base (tax credits, etc.)

(35)

934

Miscellaneous

154

(99)

Effective tax

21,34024,744

EFFECTIVE TAX RATE

31.02%

32.01%

Dec 31, 2023

Dec 31, 2022(*) Impact generated by the restatement of CVAE-type taxes.

Analysis of movements in deferred tax assets during the year:
In thousands of euros
Opening balance

10,632

12,376

Recognized in the income statement(1,858)(1,506)

20

(411)

-

-

(231)

178

58

(4)

8,621

10,632

Dec 31, 2023

Dec 31, 2022

Opening balance

8,017

8,317

Recognized in the income statement

(811)

(842)

Recognized in other comprehensive income
Changes in consolidation scope
Reclassifications
Exchange differences
CLOSING BALANCE

Analysis of movements in deferred tax liabilities during the year:
In thousands of euros

Recognized in other comprehensive income--

Changes in consolidation scope--

Changes in deferred tax liabilities via goodwill--

Transfers to liabilities held for sale

-

(258)

Reclassifications

73

435

Exchange differences

(111)

364

CLOSING BALANCE

7,169

8,017

In 2023, unrecognized deferred tax assets resulting fromtax losses recognized in subsidiaries total €1.7 million(2022: €2.2 million).

In accordance with IAS 12, a company may offset its
deferred tax assets and liabilities, subject to certain
conditions. Please refer to the "Reclassification" section
above for further details.
Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 99

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

Analysis of net deferred taxes by type:In thousands of euros
Intangible assets

Dec 31, 2023

Dec 31, 2022

(6,928)(7,086)Component-based approach (net)

271

255

Other temporary differences (net)

2,114

2,190

Internal margin on inventories

5,319

6,744

Restatement of finance leases

(36)

(36)

Employee benefits

1,693

1,565

-

-

(1,311)(1,343)330

326

Tax losses carried forward
Regulated provisions
Other (net)*
TOTAL

1,453

2,616

Of which: Deferred tax assets

8,621

10,632

Deferred tax liabilities(7,169)(8,017)* Including currency translation adjustments.

6.5.19 Earnings per share
6.5.19.1 Basic earnings per share
Basic earnings per share are calculated by dividing net
income attributable to ordinary shareholders by theweighted average number of ordinary shares outstan-ding during the year, adjusted for the number of treasury
shares held.

In thousands of euros

Dec 31, 2023

Net income attributable to holders of common shares (In thousands of euros)

Dec 31, 2022

55,56047,995Weighted average number of common shares

11,881,902

11,881,902

Treasury shares at end of period (direct holding)(47,740)(47,740)

Treasury shares at end of period (liquidity contract)(1,652)(2,574)

11,832,510

11,831,588

4.70

4.06

Adjusted weighted average number of shares outstanding over the period
BASIC EARNINGS PER SHARE (€)

6.5.19.2 Diluted earnings per share
At December 31, 2023, there are no further bonus shareplans. At December 31, 2022, dilutive potential shares
include bonus share allocations. Diluted earnings per
share are calculated by adjusting net income attributable

to ordinary shareholders by the weighted average numberof shares outstanding during the year, adjusted for theeffects of all dilutive potential ordinary shares.

Net income attributable to holders of common shares (In thousands of euros)
Expenses on grants of bonus shares
Earnings used to calculate diluted earnings (In thousands of euros)
Weighted average number of shares outstanding over the year
Treasury shares at end of period (direct holding)Treasury shares at end of period (liquidity contract)
Adjusted weighted average number of shares outstanding over the period
Dilutive effect of bonus share grants
Number of shares including dilutive effectDiluted earnings per share (€)

100 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Dec 31, 2023

Dec 31, 2022

55,56047,995-72

55,56048,067

11,881,902

11,881,902(47,740)(47,740)(1,652)(2,574)

11,832,510

11,831,588--

11,832,510

11,831,588

4.70

4.06

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.20 Goodwill
6.5.20.1 Goodwill
Goodwill is valued at cost, less any accumulated impairment losses. For the initial valuation of goodwill, seesection 6.5.3.3.
In accordance with IAS 36, goodwill is allocated to
cash-generating units for the purposes of the impairment

In thousands of euros

tests described below. Goodwill is tested for impairment
at least once a year, with more frequent testing if there areindications of impairment. It is carried at cost, less any
accumulated impairment losses. Impairment losses are
not reversible.
Dec 31, 2023

Dec 31, 2022

January 1
Opening book value

76,17383,458Acquisitions related to business combinations--

Impairment losses recognized in the income statement-(9,475)

Reclassifications/allocation of goodwill--(1,137)2,190

75,03676,173

Exchange differences, net
At December 31
Closing book value

6.5.20.2 Impairment tests - measurement of PP&E and intangible assets
In accordance with the requirements of IAS 36, an impairment test was carried out on all Cash-Generating Units("CGUs") containing goodwill.
The CGUs defined for the Vetoquinol Group are the following companies: Vetoquinol USA, Vetoquinol Canada,
Vetoquinol France, Vetoquinol UK, Vetoquinol Belgium,
Vetoquinol Switzerland, Vetoquinol Czech Republic, VetoIn thousands of euros

quinol Austria, Vetoquinol Poland, Vetoquinol Ireland,
Vetoquinol Germany, Vetoquinol Italy, Vetoquinol Scandinavia, Vetoquinol India, Vetoquinol Asia, Vetoquinol
Australia, Vetoquinol Brazil and FarmVet Systems.
The breakdown of goodwill allocated to these cash-generating units is as follows:
Dec 31, 2023

Dec 31, 2022

Vetoquinol Biowet Poland

2,196

2,036

Vetoquinol GmbH/Germany

1,705

1,705

405

396

-

-

Vetoquinol UK
Farmvet Systems
Vetoquinol Ireland

421

421

1,217

1,145

Vetoquinol Austria

772

772

Vetoquinol Czech Republic

972

997

24,96125,809500

500

Vetoquinol Italy

6,465

6,465

Vetoquinol Brazil--

Vetoquinol Scandinavia

993

991

Vetoquinol Asia

41

43

Vetoquinol Switzerland

Vetoquinol USA
Vetoquinol Belgium

Vetoquinol India

7,730

8,057

Vetoquinol SA France

14,437

14,445

Vetoquinol Australia

1,723

1,748

Vetoquinol Canada

10,497

10,644TOTAL

75,03676,173

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 101

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

The discrepancy in value between 2022 and 2023 is solely
attributable to translation adjustments for goodwill denominated in foreign currencies.

A summary table for CGUs where the amount of goodwill is significant outlines the primary assumptions andhighlights the key sensitivities.

The change in goodwill in 2022 was due to impairment
losses on the Vetoquinol Brazil CGU and to translation
adjustments.

In 2022, an impairment charge of €9.5 million was recognized following the completion of impairment tests on
fixed assets, corresponding to a write-down of the goodwill of the Brazilian CGU. This reflected the lower outlook
for this CGU in a contracted and uncertain market context
and conditions.

The recoverable amount of intangible assets is determined using the discounted cash flow method, which
is based on their value in use. This method determines
the recoverable amount of the asset by calculating thepresent value of the estimated future cash flows expected to be derived from the asset's continued use and its
eventual disposal at the end of its useful life. This value isthen reduced by the working capital requirements and thevalue of other assets existing at the test date. This valuation includes a terminal value obtained by discounting to
infinity a cash flow deemed normative at the end of theforecast period.
Cash flow projections have been prepared over a five-year
period, based on a forecast business plan for fiscal 2024
prepared by management and the following key assumptions for the years 2025 to 2028:
WACC rates have been determined by CGU taking into
account:• risk-free rate: between 3.0% and 3.5%;• market risk premium: between 5.5% and 5.8%;• pre-tax cost of debt: between 5.5% and 8.1%;• a sector Gearing of 4.9%;•a country risk premium and the country's tax rate; sector median debt-free Beta of 0.91;•a• Equity size premium of 1.2%;• WACC rates ranged from 9.3% to 14.2% depending on
the CGU;• Perpetual growth rates have been set according to thecountry in which the CGU is located, and vary from 2.0%
to 4.5% depending on the country.
CGU

No further impairment losses were recognized on theother CGUs in 2022.
There has been no impairment charge recognized in
2023.
Similarly, an impairment test was conducted on the Equistro brand, an intangible asset with an indefinite life, using
a sales growth rate of 2.0% to infinity and a discount rateof 9.5%. Please refer to the table below for further details
on this brand, which is included under the heading "Other
subsidiaries." The results of this impairment test indicatethat no impairment loss has been recognized.
A sensitivity analysis was conducted by varying the discount rate by +/- 1%. This analysis did not reveal any
significant negative differences at the end of 2023 or at
the end of 2022.

Goodwill inK€ at end
December
2023

Value ofnonamortized
trademarksin K€ at end
December
2023

Vetoquinol India

7,730

3,950

0

11,68049,383

76.3%

4.5%

-7%

14.2%

-10%

Vetoquinol Italy

6,465

-0

184

6,649

47,261

85.9%

2.0%

-7%

11.2%

-10%

Vetoquinol USA

24,9610

12,62837,589247,832

84.8%

2.3%

-9%

9.7%

-13%

Vetoquinol SA

14,437

6,828

111,781

133,046

266,781

50.1%

2.1%

-10%

9.8%

-14%

Vetoquinol Canada

10,497-0

113

10,610276,401

96.2%

2.1%

-10%

9.5%

-13%

Subtotal - selection

64,09010,778

124,707

199,575

887,658

77.5%
90.5%

Other
Total
Estimated Difference inintangible
balance Recoverable% between
assets incl.
sheet
Value (RV)Net Book“product intangible
based onValue andlist”/
assets + value in use Recoverable
Products - Goodwill
Value
Proprietary

Other subsidiaries

10,946

9,082

9,429

29,456

311,004

TOTAL ASSETS

75,036

19,859134,136

229,031

1,198,662

102 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Growthrate toinfinity

Impact in Discount% on VRrate
if growth (WACC)
rate toused
infinity
decreasesby -1%.

-9%

Impact in% on VR
if WACC
increasesby +1%.

-13%

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.21 Intangible assets
In thousands of euros

Concessions,licenses andpatents

SoftwareTrademarks"product lists/ Products Proprietary

Other
intangible
assetsTotal

At December 31, 2021
GROSS BOOK VALUE

15,684

27,113

20,245

179,780

24,661

267,483(12,597)(16,480)(46)(39,029)(20,809)(88,959)

3,087

10,633

20,200140,751

3,852

178,523

61

4,975

-

-

201

5,236

Acquisitions through business combinations

-

-

-

-

-

-

Purchase price allocation - asset recognition

-

-

-

-

-

-

Change in consolidation method

-

-

-

-

-

-

Disposals (net book value)

-

(23)

(2)

-

(5)

(30)

ACCUMULATED DEPRECIATIONNET BOOK VALUE
Acquisitions

Reclassifications

(30)

(0)

30

-

0

0

Depreciation and amortization(411)(2,853)-(12,637)(1,068)(16,968)

Deconsolidation
Exchange differences, net

-

-

-

-

-

-

90

(21)

(194)

1,642

430

1,947

16,001

31,87020,161

181,91225,931

275,875(13,203)(19,159)(128)(52,156)(22,520)(107,166)

2,797

12,711

20,033

129,757

3,410

168,709

At December 31, 2022
GROSS BOOK VALUEACCUMULATED DEPRECIATIONNET BOOK VALUE
Acquisitions

100

3,728

-

-

178

4,006

Acquisitions through business combinations

-

-

-

-

-

-

Purchase price allocation - asset recognition

-

-

-

-

-

-

Change in consolidation method

-

-

-

-

-

-

Disposals (net book value)

-

(96)

-

-

-

(96)

Reclassifications

(894)

36

11

(1,535)

2,368

(15)

Depreciation and amortization(334)(1,918)(9)(12,021)(3,971)(18,253)

-

-

-

-

-

-

(20)

22

(175)

(277)

95

(356)

Deconsolidation
Exchange differences, net
At December 31, 2023
GROSS BOOK VALUEACCUMULATED DEPRECIATIONNET BOOK VALUE

14,071

29,744

21,036

176,695

30,937

272,482(12,422)(15,262)(1,176)(60,771)(28,856)(118,487)

1,648

14,482

19,859115,924

2,081

153,995

The "Trademarks" column includes, at the end of
December 2023:•
the Equistro brand® for €8.9 million, which is anasset with an indefinite useful life and therefore notdepreciated;• t he Drontal® and Profender® brands for €6.8m;• other brands (around forty at a cost of €3.9 million) wererecognized at the time of the 2009 acquisition of Wockardt® (India); these brands are individually insignificant,and the India CGU to which they are allocated is subject
to an overall impairment test.

The "Products/Specialties" column at the end of 2023
consists mainly of the following intangible items:• products/specialties valued at €4,576,000 when Clarion
was acquired,• products/specialties valued at €5,685,000 (2022:€7,002,000) on the acquisition of Bioniche's animal
health division,• Drontal® and Profender® products/specialties for€96.1m by the end of 2023 (2022: €106.7m),• other products/specialties for the balance of 9,609 K€(2022: 10,187 K€).

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 103

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.21.1 R&D expenses
In accordance with IAS 38, research costs are expensed
and internal development costs are recognized as intangible assets only if all six criteria defined by IAS 38 aremet. Given the inherent risks and uncertainties associated with regulatory approvals and the R&D process,the criteria for capitalization are not deemed to have been
met until marketing approval has been obtained.
Payments made for the separate acquisition of researchand development work are recognized as "other intangible assets" when they meet the definition of an
intangible asset. This is determined by whether the asset
is a controlled resource from which Vetoquinol expects
future economic benefits and whether it is identifiable.
This means that the asset must be separable or result
from contractual or legal rights. In accordance withparagraph 25 of IAS 38, the initial recognition criterion,
which pertains to the probability of future economic
benefits generated by the intangible asset, is presumed
to have been met for research and development workwhen acquired separately. In this context, amounts paid
to third parties in the form of upfront or milestone payments for pharmaceutical products that have not yet
obtained marketing approval are capitalized. These rights
are amortized on a straight-line basis over their useful life,

commencing from the time marketing authorization is
obtained.
Payments related to research and development agreements for access to technologies or databases, as wellas payments for the acquisition of generic files, are also
capitalized. Intangible assets are amortized over theiruseful life as soon as they are brought into service.
Subcontracting agreements and expenditure on researchand development service contracts or payments relating
to ongoing research and development collaborations,which remain independent of the outcome of the latter,are expensed over the periods in which the services arereceived.

6.5.21.2 Other intangible assets
Intangible fixed assets are recorded in the balance sheet
at historical cost and are systematically amortized overtheir useful life, with the exception of rights, trademarks,and other components of the Equistro® range, which havean indefinite useful life. An impairment test is carried out
at least annually to validate that no impairment needs tobe recorded.
The amortization periods are consistent across theGroup:

Categories

MethodPeriodLicenses and patents

Linear

5 to 15 years

SoftwareLinear3 to 5 years

Products and/or MAs

Linear

10 to 15 years

Other inc. customer relations

Linear10 years

104 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.22 Property, plant and equipment
Property, plant, and equipment are recorded at the acquisition cost (initially the purchase price plus incidental
expenses and acquisition costs) or production cost, lessdepreciation. The straight-line depreciation method is
considered a sound economic decision. In accordancewith revised IFRS 3, fixed assets are revalued at fair value
when they are recognized following a business combination. Land is not subject to depreciation. The Groupapplies the following depreciation periods for property,
plant and equipment subject to depreciation:

Categories

MethodPeriodBuildings

Linear

15 to 40 years

FixturesLinear

10 to 20 years

Production equipment

Linear6 to 15 years

Vehicles/office equipment/researchLinear3 to 8 years

Other PP&E

Linear

5 years

In thousands of euros

Land

Buildings

Plant and Other property,
equipment
plant andequipment

3,134

87,12375,462

17,952(1,192)(60,419)(55,293)

1,942

26,704

20,169PP&E inprogress,advancesand down
payments

Total

9,409

193,081(14,219)-(131,123)

3,733

9,409

61,958At December 31, 2021
GROSS BOOK VALUEACCUMULATED DEPRECIATIONNET BOOK VALUE

337

2,953

4,355

971

10,647

19,263Acquisitions through business combinations

Additions

-

-

-

-

-

-

Purchase price allocation - asset recognition

-

-

-

-

-

-

Change in consolidation method

-

-

-

-

-

-

Disposals (net book value)
Depreciation and amortization
Exchange differences, net

-

(24)

(205)

(50)

(437)

(716)

(117)

(3,617)(4,710)(1,457)-(9,900)

(6)

267

118

13

2

393

Deconsolidation

-

-

-

-

-

-

Reclassifications

101

2,759

1,267

478

(4,605)(0)

At December 31, 2022
GROSS BOOK VALUE

3,433

86,63472,496

17,02915,016

194,607(1,175)(57,592)(51,502)(13,341)-(123,611)

2,257

29,042

20,994

3,687

15,01670,996

18

1,785

2,191

431

9,301

13,725Acquisitions through business combinations

-

-

-

-

-

-

Purchase price allocation - asset recognition

-

-

-

-

-

-

Change in consolidation method

-

-

-

-

-

-

Disposals (net book value)

-

(6)

(4)

(25)

(690)

(726)

(156)

(4,439)(5,064)(1,398)-(11,058)

24

327

95

85

489

1,021

ACCUMULATED DEPRECIATIONNET BOOK VALUE
Additions

Depreciation and amortization
Exchange differences, net
Deconsolidation

895

(259)

-

1,065

-

1,701

Reclassifications

282

3,376

5,696

1,002

(10,321)

35

4,651

92,39379,743

21,265

13,795

211,846(1,331)(62,568)(55,835)(16,418)-(136,151)

3,319

29,82523,908

4,847

13,79575,695At December 31, 2023
GROSS BOOK VALUEACCUMULATED DEPRECIATIONNET BOOK VALUE

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 105

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.23 IFRS 5This is not applicable as of December 31, 2023. As of theend of December 2023, the Group has ceased to apply

the IFRS 5 classification and adjusted its financial statements to reflect the fair value of these assets.

6.5.24 Other financial assets
As of December 31, 2023, other financial assets include
the equity interests in PAT (Plant Advanced Technologies)
for a net value of €169,000. In November 2017, Vetoquinol acquired a stake in PAT, which is headquartered inVandœuvre-lès-Nancy.
PAT specializes in the identification, optimization, andproduction of rare plant biomolecules for the cosmetics,
pharmaceutical, and agrochemical industries. PAT is apioneer in the field of environmentally-friendly, globallypatented know-how, with a particular focus on the development of PAT milking plants® and Target Binding®. The
company is listed on Euronext Growth Paris.
Other financial assets mainly comprise deposits andguarantees paid, considered as receivables, and as suchvalued at amortized cost. They are not material at Grouplevel.

6.5.25 Derivative
As of December 31, 2023, the Group held no derivative
instruments. However, as part of its foreign exchange
and interest rate risk management, the Group occasionally enters into derivative contracts. These instruments
are exclusively used by the Group's centralized treasury
department and are intended to hedge risks. With regard
to currency hedging, these contracts mainly involve thepurchase of forward contracts with maturities of lessthan one year. The Group primarily employs interest-rate
hedging instruments in the form of swaps.

The Group applies the hedge accounting provisions of IAS
39 to its hedging transactions. Derivative financial instruments are recognized in the balance sheet at fair value atthe balance sheet date, depending on the type of hedge:• For cash flow hedges, the change in the fair value of thederivative is recorded in an equity account called "cashflow hedge reserve." The change in the fair value of thederivative is reversed through the income statement as
and when the hedged risk is realized (for the effective
portion of the hedge, the ineffective portion is recordedin the income statement).
• For fair value hedges, the change in the fair value of thederivative is recognized in the income statement, as is
the change in the fair value of the hedged item.
At each balance sheet date, the fair value of the instruments used is obtained by reference to their market value.

106 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.26 Impact of change in working capital in the cash flow
statement
Dec. 31,2023

Dec. 31,2022

Inventories

116,091-(12,578)-25-

103,538

Trade and other receivables

85,350-14,104

(12)

(227)

-

99,216

Other current assets

5,973

-

(1,344)

7

28

-

4,663

816

-

(88)

(7)

0

-

721

-

-

-

-

-

-

-

120,576

0

646

(3)

749

-

121,968

11

-

(9)

-

0

-

2

-

-

-

-

-

-

-

86,010

(0)

(367)

5

(923)

-

84,726

Other long-term liabilities
Government loans
Trade and other payables (excl. payables
to fixed asset suppliers)
Other current liabilities
Government loans (portion due in lessthan 1 yr)
WCR RECONCILIATION

Changesin scope of
consolidation

Currency Restructuring
Change in Reclassifications
differences
impacts
working
capital in
CFS

In thousands of euros

6.5.27 Inventories
Purchased raw materials, packaging materials andmerchandise are valued at acquisition cost, using theweighted average cost method.

In certain instances, the FIFO (first-in, first-out) method is
employed to determine the value of various inventories.
This practice is minimal and inconsequential.

Finished products are valued at production cost, which
includes consumption of materials, direct and indirect
production expenses, and depreciation of production
assets.

When the current value at the balance sheet date (market
value for finished goods and merchandise, and value in
use for work-in-progress and raw materials) is lower thanthe book value, an impairment loss is recognized for theamount of the difference. This depreciation is applied toslow-moving items or items whose expiration date is too
close to their probable realization date.

6.5.27.1 Analysis of inventories by typeIn thousands of euros

Raw materials & consumables

Gross value

Dec 31, 2023
Impairment

37,018(1,422)Net book
value

Gross value

Dec 31, 2022
Impairment

35,59636,507(1,126)

Net
bookvalue
35,380

Other supplies

797

-

797

-

-

-

Work in progress

17,188(2,091)

15,097

17,867(972)

16,895Semi-finished and finished goods

43,265(7,646)35,61949,663(3,342)

46,321

Goods purchased for resale

16,672(243)

16,42918,881(1,386)

17,495

TOTAL

114,940(11,402)103,538

122,917(6,826)116,091

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 107

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.27.2 Analysis of inventory impairment
In thousands of euros

Dec 31, 2021

Additions Reclassifications Write-backs

Currency
differrences

Dec 31,
2022

Raw materials & consumables

960

1,532

(174)

(1,189)

(3)

1,126

Work in progress

772

988

-

(788)

(0)

972

Semi-finished and finished goods

1,972

3,874

-

(2,489)

(15)

3,342

Goods purchased for resale

1,503

1,576

-

(1,739)

46

1,386

TOTAL

5,206

7,971

(174)

(6,205)27

6,826

Additions Reclassifications Write-backs

Currency
differrences

Dec 31,
2023

In thousands of euros

Dec 31, 2022

Raw materials & consumables
Work in progress

1,126

1,498

-

(1,216)

14

1,422

972

2,194

-

(1,089)

13

2,091
7,646

Semi-finished and finished goods

3,342

11,027-(6,670)(53)

Goods purchased for resale

1,386

169

-

(1,292)

(20)

243

TOTAL

6,826

14,888-(10,267)(45)

11,402The Group monitors inventories on an individual basis,
with particular attention to pharmaceutical batches. A
100% provision is recorded for unsaleable batches thatare defective and/or do not comply with good manufacturing practice.

Similarly, batches that cannot be sold due to an expiration
date that is too short are depreciated (100% depreciationfor expiration dates of less than six months). In the eventof low sales budgets for an item, a provision for depreciation is recorded based on new sales forecasts. Sales
forecasts are reviewed on a monthly basis, taking into
account inventory volumes.

6.5.28 Trade and other receivables
In thousands of euros

Dec 31, 2023

Dec 31, 2022

Trade receivables

92,491

77,993

Impairment of trade receivables(3,169)(3,373)

Net trade receivables

89,322

74,620Prepayments

2,510

2,020

Receivables from government agencies

6,195

6,851

Other operating receivables

266

1,096

Miscellaneous receivables

922

763

-

-

Other receivables

9,893

10,730Total trade and other receivables

99,21685,350Prepaid expenses

4,207

5,524

456

449

Provisions

Loans and guarantees
Other
Total other current assets

All net trade receivables are due within one year. The valueof receivables is reduced to reflect the risk of non-recovery. This is done on a customer-by-customer basis, witheach receivable being analysed individually. However, theGroup also applies the following automatic impairment
procedure: receivables over 180 days and under 360 days
are provisioned at 50%; over 360 days, receivables areprovisioned at 100%.

108 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

0

(0)

4,663

5,973

The Group has applied the International Financial Reporting Standards (IFRS) 9 "Financial Instruments" since
January 1, 2018. The application of this standard has
resulted in the recognition of an additional provision toaccount for anticipated losses on the Group's trade receivables. As of December 31, 2023, the provision stood at€964,000 (€964,000 at December 31, 2022).

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

Receivables are recognized at their fair value, which isthe cash receivable amount. Given the Group's businesspractices, this is generally equal to the face value of thereceivable. Receivables are then recognized net of provisions for impairment, which are established following an
individual analysis of the risk of non-recovery.

6.5.29 Cash and cash equivalents
Cash and cash equivalents include bank balances, investments, and cash equivalents and are carried at fair value.
These are short-term investments and/or liquid invest-

ments that can be readily converted into a known amountof cash and are not subject to risks of changes in value(capital guarantee)..

In thousands of euros

Dec 31, 2023

Dec 31, 2022

Marketable securities

13,87428,282

Cash

133,590

65,426

Cash and cash equivalents in the balance sheet (assets)

147,464

93,708

Dec 31, 2023

Dec 31, 2022

147,464

93,708

Total cash and cash equivalents shown in the cash flow statement include:
In thousands of euros
Total cash and cash equivalents in the balance sheet
Bank overdrafts (Note 6.5.31)(1,257)(119)

Cash and cash equivalents in the CFS

146,207

93,589Additional paid-in
capitalTotal

6.5.30 Capital stock and additional paid-in capitalIn thousands of euros

Number ofsharesCapital stock

At December 31, 2021

11,881,902

29,705

41,126

70,831At December 31, 2022

11,881,902

29,705

41,126

70,831At December 31, 2023

11,881,902

29,705

41,126

70,831At December 31, 2023, the share capital of €29,704,755(2022: €29,704,755) was made up of 11,881,902 shares(2022: 11,881,902 shares) with a par value of €2.50 each.

6.5.30.1 Bonus shares
At its meeting on May 26, 2020, the Board of Directors
approved the allocation of a total of 5,500 free shares.
The shares were distributed in full on May 26, 2022.

6.5.30.2 Stock options
None.

6.5.30.3 Treasury stock excluding
liquidity contract
At the end of 2023, Vetoquinol held 47,740 of its own
shares (2022: 47,740).

6.5.30.4 Dividend distribution
Dividend distributions to Group shareholders are recorded
as liabilities over the period in which they were authorized
by the shareholders.
At the Annual General Meeting on May 25, 2023, shareholders approved a dividend payment of €9,505,521.60, or€0.80 per share. This is in line with the previous year's
dividend of €9,505,521.60, which was also €0.80 per
share. At the time of payment, Vetoquinol held some ofthese shares, so the amount of the dividend corresponding to these shares was not paid out and was allocatedto retained earnings. The total amount of dividends paidin 2023 is €9,464,535.20 (2022: €9,464,995.20).
The Group's dividend policy is to pay out at least 15% of
net income.
The Board of Directors has proposed a dividend paymentof €0.85 per share, to be paid on June 6, 2024, for the2023 fiscal year.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 109

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.31 Financial liabilities
Financial liabilities are primarily comprised of borrowings
from credit institutions and bank overdrafts.
Borrowings are carried at amortized cost, net of transaction costs incurred.
Borrowings due to be settled within one year are classified as current liabilities, except where the Group has an
unconditional right to defer settlement of the debt for atleast 12 months after the balance sheet date. In suchcases, they are classified as non-current liabilities.

For borrowings corresponding to restated finance leases,
the principal amount borrowed corresponds to the original value of the assets acquired under finance leases,
which is included under property, plant, and equipment.
Interest costs are expensed as incurred.
Please find below details of current and non-current financial liabilities:

In thousands of euros

Dec 31, 2023

Borrowings and other financial liabilities

Dec 31, 2022

172

179

Non-current lease liabilities

9,491

9,382

Total non-current financial liabilities

9,663

9,561

Borrowings and other financial liabilities

1,730

3,177

Current lease liabilities

4,978

4,564

Bank overdrafts

1,257

119

Total current financial liabilities

7,965

7,861

TOTAL FINANCIAL LIABILITIES

17,62817,422

Borrowings by maturity break down as follows:
In thousands of euros

Total< 1 year

1 to 5 years> 5 years

Borrowings and other financial liabilities

3,356

3,177

179

-

Lease liabilities

13,946

4,564

7,919

1,463

Bank overdrafts

119

119

-

-

17,422

7,861

8,098

1,463

Borrowings and other financial liabilities

1,901

1,730

172

-

Lease liabilities

14,469

4,978

8,814

677

At December 31, 2022

TOTAL FINANCIAL LIABILITIESAt December 31, 2023

Bank overdrafts

1,257

1,257

-

-

TOTAL FINANCIAL LIABILITIES

17,628

7,965

8,986

677

6.5.31.1 Reconciliation between opening and closing balances
The reconciliation between opening and closing financial debts (excluding bank overdrafts), distinguishing between cash
and non-cash cash flows, is as follows:
In thousands of euros

Borrowings and other financial
liabilities - non-current
Borrowings and other financial
liabilities - current
Lease liabilities
Hedging instruments
TOTAL FINANCIAL LIABILITIES

Dec 31, Cash flow2022

Non-cash transactions
Acquisitions

Currency Reclassification/ Changes ingains/losses
Impact fair valueof IFRS 16

Dec 31,
2023

179

-

-

(7)

-

-

172

3,177

(1,600)

-

152

-

-

1,730

13,946

-

-

(37)

560

-

14,469

-

-

-

-

-

-

0

17,303(1,600)

-

108

560

-

16,371110 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.31.2 Breakdown by currency and type of interest rate
In thousands of euros

Dec 31, 2023

Dec 31, 2022

Fixed rate

431

640

INR

431

640

Fixed rate

2,190

3,177

BRL

2,190

3,177

Fixed rate

307

416

AUD

307

416

Fixed rate

2,221

1,836

USD

2,221

1,836

Fixed rate

648

850

CAD

648

850

Fixed rate

191

58

CHF

191

58

Fixed rate

62

117

CNY

62

117

Fixed rate

47

140

CZK

47

140

Fixed rate

842

1,115

GBP

842

1,115

Fixed rate

98

156

JPY

98

156

Fixed rate

125

186

KRW

125

186

Fixed rate

314

449

MXN

314

449

Fixed rate

85

108

PLN

85

108

Fixed rate

42

17

SEK

42

17

Fixed rate on bonds
Fixed rate & floating swapped to fixedFloating rate

-

-

8,766

8,039

-

-

EUR

8,766

8,039

Fixed rate

16,371

17,303--

Total (all currencies combined)

16,371

17,303

Bank overdrafts

1,257

119

17,62817,422

Floating rate

TOTAL

6.5.31.3 Collateral given as guarantee

6.5.31.4 Credit lines

None.

• At December 31, 2023, the Group had credit lines of€45,000,000 (2022: €45,000,000) with banks. Thesecredit lines were not used at either end of 2023 or 2022.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 111

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.31.5 Liquidity risk
Given the cash position at the end of December 2023,
the Group is not exposed to liquidity risk. The contractual

cash flows include the notional amounts of financial liabilities and undiscounted contractual interest.

In thousands of euros

Carrying
amountContractual
cash flows

1,901

1,901

Breakdown of contractual cash flows< 1 year

1 to 5 years> 5 years

1,730

172

-

At December 31, 2023
Borrowings and other financial liabilities
Bank overdrafts

1,257

1,257

1,257

-

-

Trade payables

42,00142,00142,001--

Payables to fixed asset suppliers

4,012

4,012

4,012

-

-

Other operating liabilities

41,17041,17041,170--TOTAL FINANCIAL LIABILITIES

90,341

90,341

90,170172-

Carrying
amountContractual
cash flows

In thousands of euros

Breakdown of contractual cash flows< 1 year

1 to 5 years> 5 years

At December 31, 2022
Borrowings and other financial liabilities

3,356

3,356

3,177

179

-

Bank overdrafts

119

119

119

-

-

Trade payables

39,041

39,041

39,041--

Payables to fixed asset suppliers

5,289

5,289

5,289

-

-

Other operating liabilities

38,43338,43338,433--TOTAL FINANCIAL LIABILITIES

86,23886,23886,059179-

6.5.32 Provisions for employee benefits
6.5.32.1 Liabilities for pensions and other long-term employee benefits
The plans in place to provide these benefits can be classified as either defined contribution or defined benefit
plans.
Defined contribution plans: In accordance with the laws
and practices of each country, Vetoquinol makes contributions based on salaries to national organizations incharge of pension and welfare schemes. There are no
actuarial liabilities in this regard. Vetoquinol's payments
are expensed as incurred.
Defined benefit post-employment plans: The liability recognized in the balance sheet is the present value of thedefined benefit obligation at the balance sheet date.

112 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

In accordance with IAS 19 (revised), "Employee Benefits,"
the corresponding commitments are calculated annually
by independent actuaries using the projected unit credit
method with pro rata seniority at term.
The amounts of commitments corresponding to benefits
granted to employees are valued on the basis of assumptions concerning salary increases, retirement age andmortality, then discounted to their present value on thebasis of the interest rates on long-term bonds issued by
top-tier issuers.

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

Actuarial gains and losses related to pensions andpost-employment benefits resulting from adjustments
linked to changes in actuarial assumptions and expe-

rience are recognized in other comprehensive income, netof deferred taxes, in the period in which they arise.

In thousands of euros

Dec 31, 2023

Dec 31, 2022

5,885

5,631

Provision for retirement bonus
Other employee benefits (CET time savings account, long-service awards, etc.)

1,732

1,678

PROVISIONS FOR EMPLOYEE BENEFITS

7,617

7,309

6.5.32.2 Retirement bonuses
Retirement bonuses are in place for the French, Polishand Italian sites. In France, employees are entitled to
end-of-career benefits under the national collective agreement for the manufacture and sale of pharmaceutical,

parapharmaceutical and veterinary products. A sensitivity analysis, conducted by varying the discount rate by+/- 0.25%, did not reveal any significant difference in thecommitment, with a maximum difference of +/- 150 K€.

6.5.32.2.1 Changes in the corresponding liability were as follows:
In thousands of euros

Dec 31, 2023

Dec 31, 2022

5,631

7,078

674

628

77

(1,591)

(328)

(310)

Carrying amount at January 1
Expenses recognized in the income statement
Actuarial gains and losses recognized in other comprehensive income
Contributions paid
Reclassifications

(14)

33

Benefits paid from the fund

(175)

(202)

Exchange differences

19

(6)

New liabilities arising from acquisitions--

CARRYING AMOUNT AT DECEMBER 31

5,885

5,631

6.5.32.2.2 The following amounts were posted to the income statement for the year:
Dec 31, 2023

Dec 31, 2022

Cost of services rendered during the year

475

560

Financial cost

161

48

-

-

In thousands of euros

Cost of past services
Actuarial gains and losses recognized in the income statement

37

20

TOTAL

674

628

Dec 31, 2023

Dec 31, 2022

Discount rate

3.20%

3.40%

Salary increase rate

2.70%

2.70%

Social security contribution rate

45.40%

45.40%

Mortality table

TF-TH 2000-2002

Staff turnoverBy age group

6.5.32.2.3 The main actuarial assumptions applied in France are as follows:

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 113

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.32.3 Other long-term employee benefits
In France, employees are entitled to long-service awards
in accordance with Decree no. 2000-1015 in the Official
Journal of October 19, 2000, as well as company agreements or customary practice. Vetoquinol also has its

own long-service award system, under which employees
receive bonuses according to their length of service.
Similar benefits are also in place in Poland and India..

6.5.32.3.1 Changes in the corresponding liability were as follows:
Dec 31, 2023

Dec 31, 2022

1,678

1,869

Expenses recognized in the income statement

194

49

Actuarial gains and losses recorded in equity--

Contributions paid

(164)

(203)

Reclassifications

-

-

24

(37)

-

-

1,732

1,678

In thousands of euros
Carrying amount at January 1

Exchange differences
New liabilities arising from acquisitions
CARRYING AMOUNT AT DECEMBER 31

6.5.32.3.2 The following amounts were posted to the income statement for the year:
In thousands of euros
Cost of services rendered during the year
Financial cost
Cost of past services

Dec 31, 2023

Dec 31, 2022

195

299

-

-

-

-

Actuarial gains and losses recognized in the income statement

(2)

(250)

TOTAL

194

49

6.5.32.3.3 The main actuarial assumptions used for long-service awards are as follows:

Discount rate

Dec 31, 2023

Dec 31, 2022

3,10%

3,30%

Award appreciation rate

0,60%

0,90%

Social security contribution rate

45,40%

45,40%

Mortality table

TF-TH 2000-2002

Staff turnoverBy age group

114 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.33 Other provisions
Provisions are recognized when the Group has a present
obligation (legal or constructive) resulting from past
events; it is probable that an outflow of resources embodying economic benefits will be required to settle theobligation; and the amount of the obligation can bereliably estimated.

Restructuring provisions include, in particular, the cost ofrestoring premises to their original condition and severance pay. No provision is made for future operating
losses.

In thousands of euros

Provision for
litigation

Other
provisions

Total

At December 31, 2021

660

755

1,414

Additional provisions and increases

215

670

885

Amounts used

(126)

(316)

(441)

-

14

14

Reclassifications
Write-backs of amounts not used

-

-

-

Provisions arising from acquisitions

-

-

-

Exchange differences

-

1

1

At December 31, 2022

750

1,124

1,874

Additional provisions and increases

418

66

484

Amounts used

(577)

(745)

(1,322)

Reclassifications

-

19

19

Write-backs of amounts not used

-

-

-

Provisions arising from acquisitions

-

-

-

Exchange differences

-

10

10

At December 31, 2023

590

475

1,065

Dec 31, 2023

Dec 31, 2022

502

1,071

In thousands of euros
Current
Non-current
TOTAL

563

803

1,065

1,874

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 115

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

Provisions for litigation pertain to provisions for commercial and industrial disputes.
Balance sheet
amount at end
December 2023

Balance sheet
amount at end
December 2022

Litigation/termination of employment contract

453

803

Restructuring plan – Italian site closure – severance payments

1100Type of provisions

00

SUBTOTAL – NON-CURRENT PROVISION

Restructuring plan – Italian site closure – restoration of premises

563

803

Litigation/termination of employment contract

162

231

0

0

Provision for risk of non-use/collection of an asset
Provision for risks – litigation

340

840

SUBTOTAL – CURRENT PROVISION

502

1071

Dec 31, 2023

Dec 31, 2022

Trade payables

42,001

39,041

Payables to fixed asset suppliers

4,012

5,289

Tax and social security liabilities

37,97537,562Other operating liabilities

41,17038,4336.5.34 Trade and other payables
In thousands of euros

Other miscellaneous liabilities

822

5,542

Total trade and other payables

125,980

125,867

Deferred income

2

11

TOTAL OTHER CURRENT LIABILITIES2

11

All trade payables are due within one year. Other sundry operating liabilities consist mainly of "annual or quarterly discounts" payable to our indirect customers.

116 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.35 Assets and liabilities by accounting category
The fair value of derivative financial instruments is basedon valuations provided by banking counterparties.

repayment of principal and interest, discounted at market
interest rates at the balance sheet date.

The value of non-derivative financial liabilities shown in
the table below (in the "Fair value" column) represents
the present value of future cash flows generated by

Cash and cash equivalents are carried at amortized cost,
as income and interest are recognized in the income statement on a regular basis. As of December 31, 2023, there
were no outstanding derivative financial instruments.

In thousands of euros - 2023

Assets/liabilities
at fair value
through profit/
loss

Other equity investments

NonAssets/financialliabilities atamortized instruments
cost

Total
carrying
amount

Fair
value

169

-

-

169

169

Other non-current assets (loans and advances)

-

1,322

-

1,322

1,322

Trade receivables and related accounts-

103,879-

103,879 103,879

Cash and cash equivalents-

147,464-

147,464 147,464

Derivatives

-

-

-

-

169

252,664-

252,833 252,833

Bonds

-

(0)

-

Short/long-term borrowings and other financial liabilities

-

3,159

-

3,159

3,159

Lease liabilities-

14,469-14,46914,469Derivatives

-

-

-

-

-

Trade payables-

42,001-42,00142,001

Payables to fixed asset suppliers

-

4,012

-

4,012

4,012
41,170Financial assets 2023

(0)

(0)

Other operating liabilities-

41,170-41,170Financial liabilities 2023-

104,811-

104,811 104,811

In thousands of euros - 2022

Assets/liabilities
at fair value
through profit/
loss

Other equity investments

NonAssets/financialliabilities atamortized instruments
cost

Total
carrying
amount

Fair
value

266

-

-

266

266

Other non-current assets (loans and advances)

-

1,178

-

1,178

1,178

Trade receivables and related accounts-

91,323-91,32391,323

Cash and cash equivalents-

93,708-93,70893,708Derivatives

-

-

-

-

-

266

186,208-

186,474 186,474

Financial assets 2022
Bonds

-

(0)

-

(0)

(0)

Short/long-term borrowings and other financial liabilities

-

3,475

-

3,475

3,475
13,946

Lease liabilities-

13,946-

13,946

Derivatives

-

-

-

-

-

Trade payables-

39,041-

39,041

39,041

Payables to fixed asset suppliers

-

5,289

-

5,289

5,289

Other operating liabilities-

38,433-38,43338,433Financial liabilities 2022-

100,184-

100,184 100,184

6.5.36 Dividends per share
Dividends paid in 2023 amounted to €9,464,535.20 (2022:€9,464,995.20), i.e. €0.80/share (2022: €0.80/share).

The dividend to be proposed at the Annual General
Meeting on May 28, 2024 will be €0.85 per share.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 117

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.37 HeadcountFranceWesternEurope(excludingFrance)EasternEuropeAmericas

Asia

Consolidated
total

Administration

128

46

34

74

32

314

2023 Headcount by functional dept.
and geographical region

Sales & Marketing

102

189

62

262

519

1,134

IT

40

11

7

8

2

68

Production

163

0

86

70

0

319

Quality

91

7

44

62

4

208

Science

132

13

16

35

7

203

Procurement & Logistics

98

27

32

65

15

237

Total workforce 2023

754

293

281

576

579

2,483

FranceWesternEurope(excludingFrance)EasternEuropeAmericas

Asia

Consolidated
total

Administration

137

47

36

75

28

323

Sales & Marketing

101

191

65

260

505

1,122

IT

44

10

7

9

1

71

2022 Headcount by functional dept.
and geographical region

Production

176

0

89

71

0

336

Quality

102

7

52

62

4

227

Science

137

16

16

34

8

211

Procurement & Logistics

100

23

35

61

12

231

Total workforce 2022

797

294

300

572

558

2,521

Dec 31, 2023

Dec 31, 2022

886.5.38 Off-balance sheet commitments
6.5.38.1 Guarantees given
In thousands of euros
Guarantees and deposits
Mortgages and collateral

-

-

TOTAL

8

8

Dec 31, 2022

Dec 31, 2021

Guarantees and deposits--

Liability guarantees

-

-

TOTAL

-

-

6.5.38.2 Guarantees received
In thousands of euros

In connection with the acquisition of Clarion Biociëncias in 2019, the Group has paid the sum of 20 MBRL
into an escrow account to cover any liability guarantees.
The escrow period will conclude on April 15, 2024. As of
118 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

December 31, 2022, the balance remaining in the escrowaccount was 19.3 MBRL (€3,430 K). Upon completion of
the purchase price for Clarion Biociëncias, the escrowaccount will be closed.

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.38.3 Capital expenditure commitments
Investments contracted at the balance sheet date but not recorded in the accounts are as follows:
Dec 31, 2023

In thousands of euros
Intangible assets

Dec 31, 2022

80

25

Property, plant and equipment

4,956

5,692

TOTAL

5,036

5,717

Dec 31, 2023

Dec 31, 2022

1,170

1,511

-

-

1,170

1,511

6.5.39 Contingent assets and liabilities
None.

6.5.40 Related party disclosures
6.5.40.1 Compensation paid to key executives
In thousands of euros
Short-term benefits
Post-employment benefitsTOTAL

The Vetoquinol Group's key executives are:• Matthieu Frechin, Chairman and Chief Executive Officer
as of July 1, 2023, previously Chief Executive Officer;• Étienne Frechin, Chairman until July 1, 2023;• Dominique Derveaux, Group Executive Vice President;• Alain Masson, Executive Vice President and Chief

6.5.40.2 Related parties transactions
None.

Pharmacist.

6.5.41 Post-balance sheet events
6.5.41.1 Q1 2023 sales
On April 29, 2024, Vetoquinol published its sales for the 1st quarter of fiscal 2024.

6.5.42 Litigation and arbitration
To the best of our knowledge, there are no governmental,
legal, or arbitration proceedings, including any proceedings of which the company is aware, which are pendingor threatened. Furthermore, there is no reason to believethat any such proceedings are likely to have or have had
a material impact on the financial position or profitabilityof the company and/or the Group in the past 12 months.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 119

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.43 Financial / commercial situation
There have been no material changes in the financial or commercial situation since the end of the year.

6.5.44 Fees
The fees presented here relate to the fees paid to the statutory auditors and members of their networks in accordancewith AMF regulations. These fees relate to the statutory auditors of French companies (principally the issuer and a
sub-holding company), in respect of the certification and review of individual and consolidated financial statements.
Fees paid outside France include the certification of financial statements by members of the network of fully consolidated subsidiaries.
MazarsIn thousands of euros

PWC

2023

2023

AmountAmountTransmitter

105

159

Fully consolidated subsidiaries

194

116

299

275

Fees for certification of financial statements

Services other than certification of financial statements
SACC required by law and regulations - Issuer
SACC required by law and regulations - Fully consolidated subsidiaries
Other SACC - Issuer
Other SACC - Fully consolidated subsidiaries
TOTAL

6.5.44.1 Pre-approval policies and procedures defined by the Audit Committee
Vetoquinol's Audit Committee has established a policy
and procedures for the approval of audit services and the

120 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportpre-approval of other services to be provided by the Statutory Auditors.

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements

6.5.45 Group companies
Companies

Head office

Dec. 31, 2023

Dec. 31, 2022

% held % interest% held % interest

Vetoquinol SA

Magny-Vernois - 70200 Lure - France

100%

100%

100%

100%

Vetoquinol NA Inc.

2000 Chemin Georges - Lavaltrie - Québec J5T 3S5 Canada

100%

100%

100%

100%

Vetoquinol USA Inc.

Corporation trust Center - 1209 Orange Street - Wilmington Delaware 19801 - United States

100%

100%

100%

100%

Vetoquinol de Mexico SA
de CV

Blvd Manuel Avila Camacho 118 piso 22 Despacho 2202 - Col.
Lomas de Chapultepec - Delegation Miguel Hidalgo - Mexico

100%

100%

100%

100%

Vetoquinol Saude Animal
Ltda

Rua 11, quadra 7, Lote 4, Polo Empresarial Goias Etapa VI, Aparecida de Goiania-GO, CEP 74985-235 - Brazil

99%

100%

99%

100%

Vetoquinol Do Brasil Participacoes Ltda

Avenida Lavandisca, 777 escritorio- 11, Indianopolis, Sao Paulo, SP,
CEP 04515-011 - Brazil

100%

100%

100%

100%

Vetoquinol Especialidades Veterinarias SA

Carretera de Fuencarral, km 15,700 - Edificio Europa I, Portal 3, piso
2, puerta 5, - 28108 Alcobendas (Madrid) - Spain

100%

100%

100%

100%

Vetoquinol Unipessoal Lda

Rua Amílcar Cabral nº7, 3ºPiso, Sala 5 - Agualva, 2735-534 - Agualva-Cacém - Portugal

100%

100%

100%

100%

Vetoquinol UK Ltd

Steadings Barn - Pury Hill Business Park - Towcester - United
Kingdom - Northants NN12 7LS - UK

100%

100%

100%

100%

Vetoquinol Ireland Ltd

12 Northbrook Road, Ranelagh, Dublin 6 - Ireland

100%

100%

100%

100%

FarmVet Systems Ltd

27 High Street - Moneymore - Co Londonderry - Magherafelt BT45
7PA - UK

100%

100%

100%

100%

Vetoquinol NV

Galileilaan 11/401 - 2845 Niel - Belgium

99%

99%

99%

99%

Vetoquinol BV

Postbus 9202, 4801 LE Breda - The Netherlands

100%

100%

100%

100%

Vetoquinol International

Magny-Vernois - 70200 Lure - France

100%

100%

100%

100%

Frefin GmbH

Reichenbachstraße 1 - 85737 Ismaning - Germany

100%

100%

100%

100%

Vetoquinol GmbH(formerly
Reichenbachstraße 1 - 85737 Ismaning - Germany
Chassot GmbH)

100%

100%

100%

100%

Vetoquinol Biowet Poland
Ul. Kosynierow Gdynskich 13/14 St. - 66-400 Gorzów WKLP - Poland
Sp. z.o.o.

100%

100%

100%

100%

Vetoquinol AG

Freiburgstrasse 255 - 3018 Bern - Switzerland

100%

100%

100%

100%

Vetoquinol s.r.oWalterovo námestí 329/3 - Mechanika 2 - 158 00 Prague - Czech
Republic

100%

100%

100%

100%

Vetoquinol Österreich
GmbH

Gußhausstraße 14/5 1040 Wien - Austria

100%

100%

100%

100%

Vetoquinol Italia S.r.l

Via Luigi Galvani 18 - 47122 Forlì - Italy

100%

100%

100%

100%

100%

100%

100%

100%

Vetoquinol Scandinavia AB Box 9 - 265 21 Åstorp - Sweden
Frefin Mauritius Ltd.

5th Floor, Rubis Center 30 Dr Eugene Laurent Street - Port Louis Republic of Mauritius

100%

100%

100%

100%

Vetoquinol India Animal
Health Private Ltd.

Office no. 501, Hamilton-B Building, Hiranandani Business Park,
Ghodbunder Road, Thane - 400607 - India

100%

100%

100%

100%

Frefin Asia Ltd.

Rooms 2310 & 2312, 23/F, Wayson Commercial Building - 28
Connaught Road West - Sheung Wan - Hong Kong

100%

100%

100%

100%

Vetoquinol Korea Co. Ltd.

(Janghang-dong) 195, M CITY Tower, Baengma-ro,Ilsandong-gu,
Goyang-si, Geyonggi-do - South Korea

100%

100%

100%

100%

Suite 1607, Block C, 85 Loushanguan Road, Oriental International
Vetoquinol Trading (ShanPlaza, Changing District - 200336, Shanghai, People's Republic ofghai) CO., Ltd,
China

100%

100%

100%

100%

Vetoquinol Australia Pty
Ltd Inc.

Level 4, 380 Collins Street, Melbourne - Vic 3000 - Australia

100%

100%

100%

100%

Vetoquinol New ZealandLtd

Level 4, 74 Taharoto Road, Takapuna, Auckland, 0622 - New Zealand

100%

100%

100%

100%

Vetoquinol Japan K.K.

Axon Hamamatsucho Building, Shiba Daimon 1-1-23, Minato-ku,
TOKYO 105-0012 - Japan

100%

100%

100%

100%

All Group companies are exclusively controlled.
Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 121

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Statutory auditors' report on the consolidated financial statements

6.6	STATUTORY AUDITORS' REPORTON THE CONSOLIDATED FINANCIAL
STATEMENTS
Year ending December 31, 2023
To the Annual General Meeting of Vetoquinol SA,

6.6.1

OpinionIn accordance with the terms of our engagement by the
Annual General Meeting, we have audited the accompanying consolidated financial statements of Vetoquinol
SA for the year ended December 31, 2023.

the year ended December 31, 2003, as well as the financial position and assets and liabilities of the Group at thatdate, in accordance with International Financial ReportingStandards as adopted by the European Union.

In our opinion, the consolidated financial statements
provide a true and fair view of the results of operations for

The opinion expressed above is consistent with thecontent of our report to the Audit Committee..

6.6.2

Basis for opinion

6.6.2.1 Audit framework

6.6.2.2 Independence

We conducted our audit in accordance with professional
standards applicable in France. We believe that the audit
evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.

Our audit was conducted in accordance with the independence rules set out in the French Commercial Code andthe Code of Ethics for Statutory Auditors for the period
from January 1st, 2023 to the date of issue of our report.
In particular, we did not provide any services prohibited by
Article 5(1) of Regulation (EU) No. 537/2014.

Our responsibilities under these standards are set out
in the section of this report entitled "Statutory Auditors'
Responsibilities Relating to the Audit of the Consolidated
Financial Statements".

122 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Statutory auditors' report on the consolidated financial statements

6.6.3

Justification of assessments - Key audit matters

In accordance with the requirements of articles L.82153 and R.821-180 of the French Commercial Code (Codede commerce) relating to the justification of our assessments, we bring to your attention the key points of theaudit relating to the risks of material misstatement which,in our professional judgment, were the most significant
for the audit of the consolidated financial statements forthe year, as well as our responses to these risks.
These assessments were made in the context of ouraudit of the consolidated financial statements taken asa whole, and of the formation of our opinion expressed
above. We do not express an opinion on any individualcomponent of these consolidated financial statements.

6.6.3.1 Valuation of goodwill
Identified risk
As of December 31, 2023, the net value of goodwill was
75 million euros. Please refer to note 6.5.20.1, "Goodwill,"
for a detailed description of the accounting principles
used to measure goodwill. The breakdown by cash-generating unit ("CGU") is presented in note 6.5.20.2 to theconsolidated financial statements. Goodwill is reviewed
annually, or more frequently if events indicate that it may
be impaired, in accordance with the procedures set out innotes 6.5.3.5 "Impairment of assets" and 6.5.20.2 "Impairment tests - Valuation of fixed assets" to the consolidated
financial statements. The recoverable amount has been
determined by reference to the value in use, calculatedon the basis of the present value of the estimated future
cash flows of the group of assets making up each CGU.

Our response
In the context of our audit of the consolidated financial
statements, our work consisted of the following:• Reviewing impairment tests prepared by managementwith the assistance of external advisors.
• Assessing the reasonableness of cash flow projections
by interviewing financial management and comparing
them with actual 2023 results.
• Comparing the 2024 We compared the cash flows
used in the tests with the 2024 budgets drawn up by
management. We also assessed the consistency andreasonableness of the main assumptions used, including the growth rate and discount rate. Finally, we
carried out a critical review of management's analysisof the sensitivity of value in use to changes in the main
assumptions used.
Furthermore, we have evaluated the suitability of theinformation presented in Note 6.5.20 to the consolidated
financial statements..

We consider the valuation of goodwill to be a key areaof our audit, given the materiality of these assets in the
consolidated financial statements and the level of management judgment involved in determining the recoverable
amount of these assets.

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 123

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Statutory auditors' report on the consolidated financial statements

6.6.4

Specific testings

In accordance with professional standards applicable inFrance, we have also verified the information provided in
the Board of Directors' management report regarding theGroup.
We have no matters to report regarding the fair presentation and consistency of the information in the Boardof Directors' management report with the consolidated
financial statements.

6.6.5

We certify that the consolidated statement of non-financial performance required under Article L.225-102-1 of theFrench Commercial Code is included in the Group management report. It should be noted that, in accordance withthe provisions of Article L.823-10 of said Code, the information contained in this statement has not been verified
by us for fair presentation or consistency with the consolidated financial statements and must be reported on by anindependent third-party organization.

 ther verifications or information required by law
O
and regulations

6.6.5.1 P resentation format for
consolidated financial statements
to be included in the Annual
Financial Report
In accordance with the professional standards applicablein France relating to the preparation of financial statements in accordance with the Single European Electronic
Reporting Format, we have also verified that the consolidated financial statements, which are to be includedin the Annual Financial Report referred to in I of Article
L.451-1-2 of the French Monetary and Financial Code andwhich are the responsibility of the Chief Executive Officer,
comply with the format defined by European DelegatedRegulation no. 2019/815 of December 17, 2018. As these
are consolidated financial statements, our procedures
include verifying that the presentation of these financial
statements complies with the format defined by the aforementioned regulation.
Based on our work, we can confirm that the consolidated
financial statements included in the Annual Financial
Report comply with the single European electronic reporting format in all material respects.

124 _ Vetoquinol _ 2023 Universal Registration Document _ Financial report

Due to the technical limitations inherent in the macro-tagging of consolidated financial statements in accordancewith the Single European Electronic Reporting Format,
the content of certain tags in the notes may not be rendered identically to the consolidated financial statements
attached to this report.
Furthermore, it is not our responsibility to verify that theconsolidated financial statements which will be included
by your company in the annual financial report filed with
the AMF correspond to those on which we have performed our work.

6.6.5.2 A ppointment of the Statutory
Auditors
We were appointed as Statutory Auditors of Vetoquinol
SA by your General Meeting on May 23, 1990 for PricewaterhouseCoopers Audit and on May 30, 2017 for Mazars.
As of December 31, 2023, PricewaterhouseCoopers Audit
has been engaged by the company for 34 years, including
18 years since the company's shares were admitted to
trading on a regulated market. Mazars has been engaged
by the company for seven years.

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Statutory auditors' report on the consolidated financial statements

6.6.6	Responsibilities of management and persons
charged with corporate governance in relation
to the consolidated financial statements
It is the responsibility of management to prepare consolidated financial statements that give a true and fair view inaccordance with IFRS as adopted by the European Union.
Furthermore, management must implement such internal control procedures as it determines are necessary
to ensure that the consolidated financial statements arefree from material misstatement, whether due to fraud or
error.
When preparing the consolidated financial statements,
management is responsible for assessing the company's
ability to continue as a going concern, presenting thenecessary information relating to going concern in thesestatements, and applying the going concern accounting
policy, unless the company is to be wound up or cease
trading.
It is the responsibility of the Audit Committee to oversee
the financial reporting process and the effectiveness ofinternal control and risk management systems, as well asinternal audit, with respect to procedures relating to the
preparation and processing of accounting and financial
information.
The consolidated financial statements have been approved by the Board of Directors.

6.6.7	Statutory Auditors' responsibilities relating to the auditof the consolidated financial statements
6.6.7.1 Audit procedure and objective
It is our responsibility to issue a report on the consolidated financial statements. Our objective is to obtainreasonable assurance that the consolidated financial
statements, taken as a whole, are free from material
misstatement. Reasonable assurance refers to a highlevel of assurance, but does not guarantee that an audit
performed in accordance with professional standards will
identify all material misstatements. Any misstatements
may be the result of fraud or error. They are consideredmaterial when it is reasonable to expect that they could,
individually or in aggregate, influence the economic decisions made by users of the financial statements.
As stipulated by Article L.821-55 of the French Commercial Code, our role as statutory auditors does not include
guaranteeing the viability or quality of your company's
management.
In an audit conducted in accordance with professional
standards applicable in France, the statutory auditor exercises professional judgment throughout the audit.

In addition, the auditor:• Identifies and assesses the risks of material misstatement of the consolidated financial statements, whether
due to fraud or error.
• Designs and implements audit procedures to addressthese risks.
• Obtains audit evidence that it believes to be sufficientand appropriate to provide a basis for its opinion. The
risk of not detecting a material misstatement resulting
from fraud is higher than that of a material misstatement resulting from error. Fraud may involve collusion,
falsification, deliberate omission, misrepresentation, or
circumvention of internal controls.
• Obtains an understanding of internal control relevantto the audit in order to design audit procedures thatare appropriate in the circumstances, and not for the
purpose of expressing an opinion on the effectivenessof internal control;•Assesses the appropriateness of the accounting
methods used and the reasonableness of the accounting
estimates made by management, as well as the related
disclosures in the consolidated financial statements;

Vetoquinol _ 2023 Universal Registration Document _ Financial report _ 125

6 ­_ CONSOLIDATED FINANCIAL STATEMENTS
Statutory auditors' report on the consolidated financial statements•Assesses the appropriateness of the accounting
methods used and the reasonableness of the accounting estimates made by management. Furthermore, it
assesses the appropriateness of management's application of the going concern accounting policy and,based on the information gathered, determines whether
there is any significant uncertainty linked to events orcircumstances that could call into question the company's ability to continue as a going concern. This
assessment is based on information gathered up to thedate of the report, with the understanding that subsequent events or circumstances could potentially impact
the company's ability to continue as a going concern.
If the auditor determines that there is a material uncertainty, he draws the attention of the readers of his reportto the information provided in the consolidated financial
statements concerning this uncertainty. If this information is not provided or is not relevant, the auditor issues
a qualified opinion or a refusal to certify.;• Assesses the overall presentation of the consolidated
financial statements, and whether they give a true andfair view of the underlying transactions and events.
• With regard to the financial information of the persons or
entities included in the scope of consolidation, gathers
information that it considers sufficient and appropriate
to express an opinion on the consolidated financial statements. He is responsible for directing, supervising,and performing the audit of the consolidated financial
statements and for expressing an opinion on thesefinancial statements.

6.6.7.2 R eport submitted to the Audit
Committee
We provide the Audit Committee with a report thatoutlines the scope of our audit, the work program implemented, and the conclusions drawn from our work.
Furthermore, we report to the Audit Committee on any
material weaknesses in the internal control procedures
relating to the preparation and processing of financial andaccounting information.
The matters set out in the report to the Audit Committee
include the risks of material misstatement that we considered to be the most important for the purposes of ouraudit of the consolidated financial statements for theyear. These constitute the key points of our audit, which itis our responsibility to describe in this report.
Furthermore, we provide the Audit Committee with thedeclaration required by Article 6 of EU Regulation no. 5372014, confirming our independence in accordance withthe applicable rules in France, as set out in particular in
Articles L.821-27 to L.821-34 of the French Commercial
Code and in the Code of Ethics for Statutory Auditors.
When necessary, we engage in discussions with the Audit
Committee regarding the risks that may impact our independence and the measures we have in place to mitigate
them.

Lyon, April 23, 2024
The Statutory Auditors
PricewaterhouseCoopers Audit

MazarsMichel Bouzigues

Séverine Hervet

126 _ Vetoquinol _ 2023 Universal Registration Document _ Financial reportDesign and production: CYLANS

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Vetoquinol SA
French public limited company with capital of €29,704,755
676 250 111 RCS Vesoul

www.vetoquinol.com
Vetoquinol Head Office – Magny-Vernois
70200 Lure – Tel.: +33 (0)3 84 62 55 55
E-mail: relations.investisseurs@vetoquinol.com